Investing.com – After a prolonged dry spell, the software provider TeamViewer AG (ETR:TMV) delivered an unexpected surprise at the stock exchange with unexpectedly positive quarterly figures. The stock, which had been struggling in recent months, rose about 12% to €12.39 in Frankfurt trading on Wednesday. Despite this surge, the stock has still lost 10% in value so far this year and remains far from its record high of nearly €54.86 in July 2020.
The Canadian bank RBC (TSX:RY) emphasized that TeamViewer’s operating results had exceeded expectations. Additionally, a boost in invoiced amounts is expected in the second half of the year, "supported by the company's increased investments in sales FTEs, research and development (R&D), and marketing, as well as improved efficiency of the sales team. Comparisons to price increases in fiscal year 2023 should also taper off during this period. Furthermore, the first tranche of multi-year contracts (MYD) is due for renewal in the second half of the year."
RBC's price target is set at €18, with a rating of "Outperform."
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Impressive Operational Results
In the second quarter, TeamViewer managed to maintain its adjusted profit margin before interest, taxes, depreciation, and amortization (EBITDA) at 41%. For the full year, the company expects at least 43%. Adjusted EBITDA rose by 6% year-on-year to €67.5 million, while analysts had expected a smaller increase. Revenue also grew by 6% to €164.1M. Excluding currency effects, the revenue increase would have been 9%.
Decline in Profit Due to Higher Taxes
Despite the positive operational developments, net profit fell to €26.5M due to higher tax expenses, down from €34.0M in the previous year. Nevertheless, the company's medium-term prospects remain robust. TeamViewer confirmed its annual targets and continues to aim for revenue between €660M and €685M.
A Stock on the Rise
The stock market applauded the solid quarterly results and optimistic projections for the second half of the year. The share price recovered from its recent low and showed a significant upward trend. Investors seem to be gradually regaining confidence in the company’s potential.
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