CSP (NASDAQ:CSPI) Releases Earnings Results

CSP (NASDAQ:CSPI) released its earnings results on Friday. The information technology services provider reported ($0.09) earnings per share for the quarter, Zacks reports. CSP had a negative return on equity of 0.25% and a negative net margin of 0.20%.

Here are the key takeaways from CSP’s conference call:

• Third-quarter revenue declined to $14.4 million from $15.4 million year over year, while the net loss widened to $846,000, or $0.09 per share, from $264,000. Results were affected by hardware delivery delays, higher expenses, and costs related to the U.K. pension buyout.
• Technology Solutions backlog increased 65% year over year as hardware lead times extended from roughly 30–60 days to more than 200 days; management expects supply constraints could persist for at least another year, delaying revenue recognition.
• AZT PROTECT advanced through several large enterprise opportunities, including six-figure deals nearing the end of 18–24-month sales cycles. The company also reported a 100% renewal rate at customer sites reaching their one-year renewal period, a third South African telecom purchase order, and completed integration with Acronis ahead of a planned fall launch.
• Managed cloud and service operations continued to grow, including a six-year, seven-figure agreement with a professional sports team and a three-year agreement expected to generate mid-six-figure annual recurring revenue. Service gross margin improved by 1.3 percentage points year over year.
• CSPi ended the quarter with $24.7 million in cash and continued supporting customer financing, while maintaining its $0.03-per-share dividend and repurchasing approximately 13,000 shares.

CSP Trading Down 2.7%

CSPI stock traded down $0.23 on Friday, hitting $8.13. The company had a trading volume of 32,915 shares, compared to its average volume of 25,862. The stock has a market cap of $81.94 million, a price-to-earnings ratio of -813.50 and a beta of 0.85. The stock’s 50-day simple moving average is $8.35 and its 200 day simple moving average is $9.00. CSP has a 12-month low of $7.45 and a 12-month high of $15.00.

Wall Street Analyst Weigh In

Separately, Weiss Ratings reissued a “sell (d+)” rating on shares of CSP in a research report on Friday, August 7th. One analyst has rated the stock with a Sell rating, Based on data from MarketBeat.com, the company currently has a consensus rating of “Sell”.

Hedge Funds Weigh In On CSP

A number of institutional investors and hedge funds have recently modified their holdings of the company. Bank of America Corp DE grew its holdings in shares of CSP by 3,943.3% in the second quarter. Bank of America Corp DE now owns 2,426 shares of the information technology services provider’s stock worth $31,000 after acquiring an additional 2,366 shares during the period. Geode Capital Management LLC lifted its holdings in CSP by 1.7% in the fourth quarter. Geode Capital Management LLC now owns 163,385 shares of the information technology services provider’s stock valued at $2,043,000 after acquiring an additional 2,739 shares during the period. Wells Fargo & Company MN lifted its holdings in CSP by 72.6% in the fourth quarter. Wells Fargo & Company MN now owns 7,618 shares of the information technology services provider’s stock valued at $95,000 after acquiring an additional 3,204 shares during the period. JPMorgan Chase & Co. boosted its position in CSP by 14.4% in the second quarter. JPMorgan Chase & Co. now owns 26,079 shares of the information technology services provider’s stock worth $337,000 after purchasing an additional 3,279 shares during the last quarter. Finally, MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. purchased a new position in CSP in the second quarter worth about $49,000. 26.74% of the stock is currently owned by hedge funds and other institutional investors.

CSP Company Profile

CSP Inc develops and markets IT integration solutions, security products, managed IT services, cloud services, purpose-built network adapters, and cluster computer systems for commercial and defense customers worldwide. It operates in two segments, Technology Solutions and High Performance Products. The Technology Solutions segment provides third-party computer hardware and software as a value-added reseller to various customers in web and infrastructure hosting, education, telecommunications, healthcare services, distribution, financial and professional services, and manufacturing industries.