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eGain Communications Corporation (EGAN)
:EGAN
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eGain
(NASDAQ:EGAN)
61Neutral
eGain (EGAN) vs. S&P 500 (SPY)
Market Cap
$137.84M
Dividend YieldN/A
Average Volume (3M)73.34K
Price to Earnings (P/E)35.1
Beta (1Y)0.97
Revenue Growth-6.94%
EPS Growth-34.87%
CountryUS
Employees544
SectorTechnology
Sector Strength54
IndustrySoftware
Share Statistics
EPS (TTM)0.14
Shares Outstanding28,130,920
10 Day Avg. Volume61,972
30 Day Avg. Volume73,345
Financial Highlights & Ratios
PEG Ratio1.18
Price to Book (P/B)N/A
Price to Sales (P/S)1.53
Price to Cash Flow (P/CF)5.30
P/FCF Ratio5.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$8.00Price Target Upside60.00% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
eGain Business Overview & Revenue Model
Company DescriptioneGain Corporation (NASDAQ: EGAN) is a leading provider of cloud-based customer engagement software solutions. The company operates primarily within the technology sector, offering a comprehensive suite of applications designed to enhance customer service, support, and experience across digital channels. eGain's core products include AI-powered chatbots, knowledge management systems, and analytics tools, which help businesses automate, optimize, and personalize their customer interactions.
How the Company Makes MoneyeGain makes money through a subscription-based revenue model, where clients pay recurring fees to access its cloud-based customer engagement solutions. Key revenue streams include software-as-a-service (SaaS) subscriptions, professional services such as implementation and consulting, and ongoing customer support. The company also benefits from strategic partnerships with major technology firms, which help expand its market reach and enhance its offerings. Additionally, eGain's ability to continually innovate and adapt its software to emerging market trends and customer needs plays a significant role in driving its earnings.
eGain Financial Statement Overview
Summary
eGain exhibits a strong gross profit margin and a solid balance sheet with low leverage, reflecting financial stability. However, the company faces challenges in revenue growth and cash flow management, which could impact long-term profitability if not addressed. Focused efforts on operational efficiency and cash generation can enhance financial performance.Income Statement
eGain's TTM (Trailing-Twelve-Months) gross profit margin stands strong at 69.2%, showcasing effective cost management. However, the net profit margin of 5.95% indicates room for improvement in operational efficiency. The revenue declined by 4.1% from the previous year, suggesting challenges in maintaining growth. The EBIT and EBITDA margins are moderate at 3.7% and 5.4%, respectively, indicating potential for higher earnings with operational optimizations.72
Positive
Balance Sheet
The company's debt-to-equity ratio is low at 0.07, indicating a strong equity position with minimal reliance on debt. The return on equity (ROE) is modest at 9.58%, reflecting moderate profitability. With an equity ratio of 49.7%, eGain maintains a solid balance of assets financed by equity, ensuring financial stability.78
Positive
Cash Flow
The free cash flow growth rate is negative, reflecting a decrease in cash generation capabilities. The operating cash flow to net income ratio is negative, indicating challenges in converting profits into cash. The free cash flow to net income ratio is also negative, signaling potential liquidity issues. These metrics highlight the need for improved cash management strategies.65
Positive
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 89.00M | 92.80M | 98.01M | 91.95M | 78.29M | 72.73M | Gross Profit |
| 61.56M | 65.21M | 70.70M | 67.41M | 59.02M | 51.65M | EBIT |
| 3.29M | 5.97M | 1.39M | -2.14M | 5.25M | 5.29M | EBITDA |
| 4.80M | 12.70M | 1.39M | -614.00K | 7.34M | 7.41M | Net Income Common Stockholders |
| 5.30M | 7.78M | 2.11M | -2.44M | 6.96M | 7.21M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 70.53M | 70.00M | 73.20M | 72.17M | 63.23M | 46.61M | Total Assets |
| 111.26M | 127.85M | 130.12M | 126.01M | 114.56M | 93.70M | Total Debt |
| 3.88M | 3.77M | 2.59M | 3.58M | 2.26M | 3.14M | Net Debt |
| -66.65M | -66.23M | -70.61M | -68.59M | -60.97M | -43.47M | Total Liabilities |
| 56.00M | 69.36M | 68.42M | 69.15M | 68.50M | 59.06M | Stockholders Equity |
| 55.26M | 58.50M | 61.70M | 56.86M | 46.06M | 34.64M |
| Cash Flow | Free Cash Flow | ||||
| 3.69M | 12.26M | 4.33M | 7.49M | 13.46M | 13.54M | Operating Cash Flow |
| 4.01M | 12.45M | 4.62M | 8.12M | 13.86M | 14.06M | Investing Cash Flow |
| -311.00K | -198.00K | -288.00K | -628.00K | -402.00K | -514.00K | Financing Cash Flow |
| -19.40M | -15.39M | -4.08M | 3.33M | 2.35M | 1.41M |
eGain Technical Analysis
Neutral
5.00
Price Trends
5.57
Negative
5.61
Negative
5.84
Negative
Market Momentum
-0.16
Negative
47.47
Neutral
78.32
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EGAN, the sentiment is Neutral. The current price of 5 is above the 20-day moving average (MA) of 4.85, below the 50-day MA of 5.57, and below the 200-day MA of 5.84, indicating a neutral trend. The MACD of -0.16 indicates Negative momentum. The RSI at 47.47 is Neutral, neither overbought nor oversold. The STOCH value of 78.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for EGAN.
eGain Risk Analysis
eGain disclosed 38 risk factors in its most recent earnings report. eGain reported the most risks in the “Tech & Innovation” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
eGain Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $270.03B | 45.36 | 10.26% | 0.55% | 8.72% | 51.47% | |
73 Outperform | $9.97B | 23.52 | 12.77% | ― | 15.05% | 31.05% | |
68 Neutral | $6.51B | 68.29 | 21.12% | 0.16% | 4.51% | 43.29% | |
63 Neutral | $16.22B | ― | -1.24% | ― | 7.32% | 88.51% | |
61 Neutral | $137.84M | 35.14 | 7.08% | ― | -6.94% | -34.87% | |
58 Neutral | $21.97B | 10.63 | -18.43% | 2.40% | 4.67% | -24.47% | |
47 Neutral | $125.31M | ― | -365.12% | ― | -13.43% | 15.63% |
* Technology Sector Average
Performance Comparison
EGAN
eGain
5.00
-1.45
-22.48%
NICE
NICE
159.06
-101.56
-38.97%
PEGA
Pegasystems
74.45
9.89
15.32%
CRM
Salesforce
280.99
-18.91
-6.31%
TWLO
Twilio
104.20
43.05
70.40%
VERI
Veritone
2.66
-2.60
-49.43%
eGain Earnings Call Summary
Earnings Call Date: Feb 13, 2025 | % Change Since: -20.26% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook. While the company achieved significant growth in its AI knowledge hub and secured new enterprise clients, it faced revenue declines and reduced guidance for fiscal 2025. The company's strategic investments in AI and product innovation are promising, but the extended sales cycles for large deals and reduced PS revenue present challenges.Highlights
New Enterprise Logos and AI Knowledge Hub Growth
eGain Corporation closed several new enterprise logos, leading to a 17% year-over-year increase in AI knowledge hub Annual Recurring Revenue (ARR). Notable new clients include a major US airline, a leading interactive entertainment company, and a global money transfer company.
Successful eGain Solve 2024 Event and Product Launch
The company held a successful eGain Solve 2024 event in Chicago, where it announced the eGain AI Agent, a new omnichannel conversational product. Customer interest in the eGain AI Agent is strong, and it is set to launch in the current quarter.
Strong Cash Position and Share Repurchase Program
eGain generated $6.4 million in cash flow from operations, with total cash and cash equivalents at the end of the quarter amounting to $70.5 million. Additionally, the company repurchased 121,000 shares, totaling $2.4 million, under its share repurchase program.
Lowlights
Decrease in Total Revenue and Adjusted EBITDA Margin
Total revenue for the second quarter was $22.4 million, down 6% year over year. Adjusted EBITDA margin for the quarter was 7%, compared to 16% in the year-ago quarter, reflecting a decrease in profitability.
Guidance Reduction for Fiscal 2025
eGain lowered its total revenue guidance for fiscal 2025 to $88.5 million to $90 million, down from the original guidance of $92 million to $93 million. Non-GAAP net income guidance was also reduced.
Professional Services Revenue Decline
The company reduced its Professional Services (PS) revenue target for fiscal 2025 by approximately $2 million due to recent product improvements and a strategy to decrease PS revenue through increased product capabilities and third-party partnerships.
Company Guidance
During the call, eGain Corporation provided guidance for fiscal year 2025, highlighting several key metrics. They reported a total revenue of $22.4 million for the second quarter, a 6% decline year-over-year, primarily due to the loss of two large clients. SaaS revenue comprised 93% of total revenue, while non-GAAP net income was $1.3 million, or $0.05 per basic share. The company adjusted its fiscal year 2025 revenue guidance to a range of $88.5 million to $90 million, down from $92 million to $93 million, with SaaS revenue expected to remain at approximately 93%. Additionally, they revised their non-GAAP net income guidance to $4.1 million to $4.7 million, and GAAP net income guidance to $1.1 million to $1.7 million. The company noted a 17% increase in AI knowledge hub ARR and an expansion in the pipeline of seven-figure ARR deals, despite longer sales cycles. Operating cash flow for the quarter was $6.4 million, with total cash and equivalents at $70.5 million.eGain Corporate Events
Executive/Board Changes
eGain Approves CEO Compensation and Executive Stock Options
Neutral
Dec 12, 2024
eGain Corporation’s Board approved a variable annual cash compensation of $60,000 for CEO Ashutosh Roy for fiscal year 2024, without altering his base salary. Additionally, stock options were granted to key executives, priced at $5.71 per share, vesting in September 2025, potentially impacting executive retention and motivation.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.