Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Key Reasons To Add Citrix (CTXS) Stock To Your Portfolio Now

Published 04/03/2018, 10:40 PM
Updated 07/09/2023, 06:31 AM

Citrix Systems Inc. (NASDAQ:CTXS) appears a promising pick right now on the back of stellar fourth-quarter 2017 results, strong product portfolio and acquisition synergies. Moreover, it has been a favorite with investors, courtesy of its rising share price and strong fundamentals.

The company’sshares have returned 15.3% over the past six months, substantially outperforming the 10.9% rally of the industry it belongs to.

Notably, Citrixhas a number of other aspects that make it a lucrative investment option.

Upbeat Q4 Results

Citrix delivered better-than-expected earnings and revenues in the fourth quarter of 2017.

The cloud computing company’s earnings (excluding $3.59 from non-recurring items) came in at $1.66 per share, above the Zacks Consensus Estimate of $1.60. The bottom line also increased 3.1% from the year-ago figure.

Net revenues came in at $777.9 million, marginally higher than the Zacks Consensus Estimate of $777.6 million.

Positive Earnings Surprise History

Citrix has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in the trailing four quarters, recording a positive average earnings surprise of 7.1%.

Robust SaaS Revenues Aids Citrix

Software-as-a-Service (SaaS) revenues are anticipated to be robust in the first quarter identical to the last four quarters. This in turn will boost the company’s top-line in the period as well. In the last reported-quarter SaaS revenues came in at $49.71 million, up 37.6% from the prior-year quarter. The Zacks Consensus Estimate for first-quarter SaaS revenues stands at $51 million, higher as reported in the previous quarter.

Strong Product Portfolio & Buyouts

We are impressed by the company's efforts to expand its product portfolio. Citrix’s strong customer base is also a catalyst. In a customer-friendly move, the company recently purchased Cedexis — a web monitoring company. Apart from widening the choices to Citrix’s customers, the deal offers increased flexibility aimed at improving operational performance and efficiencies. The addition of Cedexis’ technology will enhance Citrix’s networking portfolio. The company completed the spin-off and merger of its GoTo business with LogMeIn last year aimed at improving its efficiencies.

Share Buyback Program

Citrix has recently entered into an accelerated share repurchase (ASR) transaction with Goldman Sachs & Co (NYSE:GS). LLC to buy back an aggregate of $750 million shares. This move is part of the previously announced capital return program by dint of which, the company aims to return $2 billion to its shareholders by Dec 31, 2018. In November 2017, the company’s board cleared a share buyback program worth more than $2 billion. Citrix has already repurchased $750 million shares of the total authorization. Following this new ASR, the company will be left with $500 million shares to be bought back.

Superior Return on Equity (ROE)

Citrix has an ROE of 45.2%, a lot better than the industry average of 30.3%. This shows that the company reinvests its cash more efficiently.

Zacks Rank & Other Key Picks

Citrix carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the broader technology sector include Applied Materials, Inc. (NASDAQ:AMAT) , NVIDIA Corporation (NASDAQ:NVDA) and Western Digital Corporation (NASDAQ:WDC) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Applied Materials, NVIDIA and Western Digital have a long-term expected EPS growth rate of 13.26%, 10.25% and 19%, respectively.

Wall Street’s Next Amazon (NASDAQ:AMZN)

Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.

Click for details >>



Western Digital Corporation (WDC): Free Stock Analysis Report

Citrix Systems, Inc. (CTXS): Free Stock Analysis Report

NVIDIA Corporation (NVDA): Free Stock Analysis Report

Applied Materials, Inc. (AMAT): Free Stock Analysis Report

Original post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.