Boston, MA 05/02/2014 (wallstreetpr) – As usual, negative performance scorecard does not attract positive comments. Just as investors worried about the company’s performance prospects in light of a quarter reported riddled with losses, analysts too had their worries to the point of lowering view on the stock of Servicesource International Inc (NASDAQ:SREV).
The company tried its best to deliver positive results in the latest quarter, but given market challenges and high costs and expenses within the company’s ranks, a profit was hard to come by in Q1. As such, the company announced a loss that exceeded what Wall Street expected. However, the company followed the results with a lengthy explanation about why a strong performance eluded it in Q1.
Choosing not to dwell in the past, the company deemed it right to talk about the future. The management acknowledged the weak Q1 performance and on top of that the management also said it learned some good lessons that should help in the achievement of stronger results in the balance of the year.
But before the next reporting, analysts at CLSA looked impatient to the point of immediately raising a red flag. The analysts followed their reaction to the weak Q1 data with a note to investors warning that Servicesource International Inc (NASDAQ:SREV) was no longer a “buy” stock but an “underperform” candidate.
As if that is what analysts were waiting to see or hear, shares of Servicesource took a downward rally as investors headed for the exit door.
Executive comment
According to CEO Mike Smerklo, there is no gainsaying that Q1 was a very poor quarter. However, with lessons learned and opportunities existing, the company expects to aggressively pursue growth and profitability. Moreover, the executive remarked that, in addition to renewed efforts in getting customers, the company will look into its internal structures to curb costs and expenses in a bid to support the bottom-line.
Servicesource International Inc (NASDAQ:SREV) believes that it already has what the market wants and all that is needed is to get the word out there and aligning its systems to the market reality. The company recently announced a long-term contract with New Constructs, a company that provides investment analysts.
The quarter that failed to impress
Q12014 revenue was $66.8 million, up about 9 percent over a year ago revenue but short of $68.56 million that Wall Street expected. The company reported a net loss per share of 23 cents at a time when analysts were looking for net loss per share of 7 cents.
