CDK Shares Jump on Strong Fiscal 2nd Qtr

CDK Shares Jump on Strong Fiscal 2nd Qtr

February 3, 2017 — CDK Global’s stock price hit its all time high yesterday of $65.03 following a strong second quarter fiscal 2017 report. It settled back down to close at just over $64. The stock has been on an upward trajectory the last six months and was trading at just under $54 a share in early November.

Adjusted revenues jumped 5% to 547.8 million while EBITDA margin increased to 32.8% putting the company in on target to meet its objective 35% margins in 2018.

The company also reported it has completed the $1 billion return of capital to shareholders by the end of calendar year 2016. During the quarter, the company executed $20 million of dividend payments, $20 million of open market share repurchases and $330 million of accelerated share repurchases.

Going forward, the company expects to return to shareholders $750 million to $1 billion per calendar year through 2019, through a combination of dividends and share repurchases.

CDK also upgraded its Fiscal 2017 forecast yesterday, which also contributed to the stock jump.

Fiscal 2017 Forecast GAAP   Adjusted
Revenues up 4% – 5% up 4% – 5%
Earnings before income taxes up 17% – 19% up 23% – 26%
Net earnings attributable to CDK up 21% – 23% up 26% – 29%
Diluted net earnings attributable
to CDK per share
up 28% – 32% up 34% – 37%
$1.93 – $1.99 $2.33 – $2.38




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