Magic Software Enterprises (NASDAQ:MGIC) Shares Gap Up After Better-Than-Expected Earnings

Key Points

• Magic Software Enterprises shares surged from $18.80 to $19.94 after reporting earnings per share of $0.26, surpassing analyst expectations of $0.24.
• Wall Street Zen downgraded the company's rating from "strong-buy" to "buy" following their earnings announcement.
• Institutional investors account for 24.70% of Magic Software's stock ownership, with several firms significantly increasing their stakes in recent quarters.

Magic Software Enterprises Ltd. (NASDAQ:MGIC - Get Free Report) shares gapped up before the market opened on Wednesday following a better than expected earnings announcement. The stock had previously closed at $18.80, but opened at $19.94. Magic Software Enterprises shares last traded at $20.05, with a volume of 23,458 shares traded.

The software maker reported $0.26 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.24 by $0.02. Magic Software Enterprises had a return on equity of 15.62% and a net margin of 6.60%.

Wall Street Analyst Weigh In

Separately, Wall Street Zen cut Magic Software Enterprises from a "strong-buy" rating to a "buy" rating in a research note on Saturday, May 24th.

Institutional Inflows and Outflows

Several large investors have recently bought and sold shares of the stock. Geode Capital Management LLC raised its position in Magic Software Enterprises by 4.7% during the 4th quarter. Geode Capital Management LLC now owns 58,105 shares of the software maker's stock worth $699,000 after purchasing an additional 2,587 shares during the last quarter. Lazard Asset Management LLC grew its holdings in Magic Software Enterprises by 45.5% during the 4th quarter. Lazard Asset Management LLC now owns 18,795 shares of the software maker's stock worth $226,000 after acquiring an additional 5,878 shares during the period. GHP Investment Advisors Inc. grew its holdings in Magic Software Enterprises by 16.9% during the 1st quarter. GHP Investment Advisors Inc. now owns 56,751 shares of the software maker's stock worth $737,000 after acquiring an additional 8,200 shares during the period. Legal & General Group Plc grew its holdings in Magic Software Enterprises by 34.6% during the 2nd quarter. Legal & General Group Plc now owns 32,220 shares of the software maker's stock worth $616,000 after acquiring an additional 8,289 shares during the period. Finally, Phoenix Financial Ltd. grew its holdings in Magic Software Enterprises by 1.3% during the 1st quarter. Phoenix Financial Ltd. now owns 689,236 shares of the software maker's stock worth $8,953,000 after acquiring an additional 9,000 shares during the period. 24.70% of the stock is owned by institutional investors.

Magic Software Enterprises Stock Performance

The company has a debt-to-equity ratio of 0.11, a quick ratio of 1.51 and a current ratio of 1.51. The stock has a fifty day simple moving average of $19.27 and a two-hundred day simple moving average of $15.56. The stock has a market capitalization of $988.63 million, a price-to-earnings ratio of 26.38 and a beta of 1.04.

About Magic Software Enterprises

Magic Software Enterprises Ltd. provides proprietary application development, vertical software solutions, business process integration, information technologies (IT) outsourcing software services, and cloud-based services in Israel and internationally. Its Software Services segment develops, markets, sells, and supports application platform, software applications, and business and process integration solutions and related services.

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