Bandwidth (NASDAQ:BAND) Stock Price Up 9.9% Following Earnings Beat

Key Points

• Bandwidth shares rose 9.9% after the company reported quarterly EPS of $0.50, exceeding estimates by $0.03, while revenue of $234.02 million topped forecasts and increased 21.9% year over year.
• Analyst sentiment remains mixed: four analysts rate the stock a Buy, four a Hold and one a Sell, resulting in a consensus Hold rating and an average price target of $59.29.
• Institutional ownership stands at 68.53%, with several large investors increasing their stakes, while insiders sold 25,050 shares worth approximately $1.23 million over the past three months.

Bandwidth Inc. (NASDAQ:BAND - Get Free Report)'s stock price traded up 9.9% on Thursday following a better than expected earnings announcement. The company traded as high as $52.44 and last traded at $53.2240. 293,389 shares were traded during mid-day trading, a decline of 66% from the average daily volume of 873,741 shares. The stock had previously closed at $48.45.

The company reported $0.50 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.47 by $0.03. The firm had revenue of $234.02 million for the quarter, compared to analyst estimates of $233.15 million. Bandwidth had a net margin of 0.27% and a return on equity of 1.85%. Bandwidth's revenue was up 21.9% compared to the same quarter last year.

Analyst Upgrades and Downgrades

Several research firms recently weighed in on BAND. Needham & Company LLC reissued a "buy" rating on shares of Bandwidth in a report on Thursday, August 20th. Weiss Ratings lowered shares of Bandwidth from a "hold (c)" rating to a "sell (d+)" rating in a research report on Friday, October 23rd. Citizens Jmp increased their target price on Bandwidth from $70.00 to $86.00 and gave the stock a "market outperform" rating in a research report on Monday, July 20th. Morgan Stanley initiated coverage on shares of Bandwidth in a report on Friday, October 16th. They issued an "equal weight" rating and a $56.00 price target for the company. Finally, B. Riley Financial upped their price objective on shares of Bandwidth from $55.00 to $85.00 and gave the stock a "buy" rating in a research report on Thursday, July 9th. Four research analysts have rated the stock with a Buy rating, four have issued a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat.com, the stock presently has a consensus rating of "Hold" and an average price target of $59.29.

Insider Transactions at Bandwidth

In related news, Director Lukas Roush sold 1,500 shares of the stock in a transaction that occurred on Friday, October 16th. The stock was sold at an average price of $49.04, for a total transaction of $73,560.00. Following the completion of the transaction, the director directly owned 58,769 shares of the company's stock, valued at approximately $2,882,031.76. This represents a 2.49% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO David A. Morken sold 5,128 shares of the firm's stock in a transaction on Monday, August 31st. The shares were sold at an average price of $49.15, for a total transaction of $252,041.20. Following the completion of the transaction, the chief executive officer directly owned 6,702 shares of the company's stock, valued at approximately $329,403.30. This trade represents a 43.35% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 25,050 shares of company stock worth $1,228,342 over the last three months. 5.26% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Bandwidth

Institutional investors and hedge funds have recently modified their holdings of the business. Wellington Management Group LLP raised its stake in shares of Bandwidth by 138.9% in the second quarter. Wellington Management Group LLP now owns 911,893 shares of the company's stock worth $57,723,000 after purchasing an additional 530,182 shares during the last quarter. Dimensional Fund Advisors LP lifted its position in shares of Bandwidth by 6.3% during the 1st quarter. Dimensional Fund Advisors LP now owns 1,551,508 shares of the company's stock valued at $27,647,000 after buying an additional 91,812 shares in the last quarter. Arrowstreet Capital Limited Partnership raised its position in shares of Bandwidth by 299.5% during the 1st quarter. Arrowstreet Capital Limited Partnership now owns 688,430 shares of the company's stock worth $12,268,000 after purchasing an additional 516,117 shares during the last quarter. Renaissance Technologies LLC increased its position in shares of Bandwidth by 4.2% during the first quarter. Renaissance Technologies LLC now owns 644,981 shares of the company's stock worth $11,494,000 after purchasing an additional 26,081 shares in the last quarter. Finally, Bank of New York Mellon Corp purchased a new stake in Bandwidth during the 2nd quarter valued at about $6,711,000. 68.53% of the stock is owned by institutional investors.

Bandwidth Stock Up 7.9%

The company has a quick ratio of 2.04, a current ratio of 2.04 and a debt-to-equity ratio of 0.87. The firm has a market capitalization of $1.68 billion, a PE ratio of -177.53, a price-to-earnings-growth ratio of 3.94 and a beta of 3.01. The business has a 50-day moving average price of $51.54 and a 200-day moving average price of $40.39.

Bandwidth Company Profile

Bandwidth Inc NASDAQ: BAND is a cloud communications company that provides application programming interfaces (APIs) and related network services for integrating voice, messaging and emergency communications into software applications. Its platform is designed for businesses, communications providers and technology companies that need to build communications capabilities into customer-facing products and internal workflows.

The company's offerings include programmable voice, text messaging and toll-free messaging services, as well as emergency calling capabilities through its E911 solution.

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