Magic Software Enterprises (NASDAQ:MGIC) Shares Gap Up After Earnings Beat

Magic Software Enterprises Ltd. (NASDAQ:MGIC)’s stock price gapped up before the market opened on Wednesday after the company announced better than expected quarterly earnings. The stock had previously closed at $18.80, but opened at $19.94. Magic Software Enterprises shares last traded at $20.05, with a volume of 23,458 shares traded.

The software maker reported $0.26 earnings per share for the quarter, beating analysts’ consensus estimates of $0.24 by $0.02. Magic Software Enterprises had a return on equity of 15.89% and a net margin of 6.58%. The business had revenue of $151.60 million for the quarter, compared to analysts’ expectations of $143.06 million.

Magic Software Enterprises Cuts Dividend

The company also recently disclosed a semi-annual dividend, which will be paid on Wednesday, October 22nd. Shareholders of record on Monday, October 6th will be given a dividend of $0.296 per share. The ex-dividend date is Monday, October 6th. This represents a yield of 290.0%. Magic Software Enterprises’s dividend payout ratio (DPR) is presently 83.33%.

Analysts Set New Price Targets

Several research analysts have weighed in on MGIC shares. Wall Street Zen cut Magic Software Enterprises from a “strong-buy” rating to a “buy” rating in a research report on Saturday, May 24th. Barclays reiterated an “overweight” rating and set a $18.00 price objective (up previously from $16.00) on shares of Magic Software Enterprises in a research report on Wednesday.

Institutional Inflows and Outflows

Large investors have recently added to or reduced their stakes in the company. Raymond James Financial Inc. bought a new position in Magic Software Enterprises during the 2nd quarter worth $33,000. Altshuler Shaham Ltd bought a new position in shares of Magic Software Enterprises in the fourth quarter worth $138,000. Man Group plc bought a new position in shares of Magic Software Enterprises in the fourth quarter worth $145,000. Walleye Capital LLC bought a new position in shares of Magic Software Enterprises in the first quarter worth $161,000. Finally, Corton Capital Inc. bought a new position in shares of Magic Software Enterprises in the second quarter worth $286,000. Institutional investors own 24.70% of the company’s stock.

Magic Software Enterprises Stock Down 2.4%

The company has a debt-to-equity ratio of 0.11, a current ratio of 1.51 and a quick ratio of 1.51. The company has a market cap of $982 million, a P/E ratio of 25.64 and a beta of 1.04. The stock has a 50-day moving average of $19.43 and a 200 day moving average of $15.65.

Magic Software Enterprises Company Profile

Magic Software Enterprises Ltd. provides proprietary application development, vertical software solutions, business process integration, information technologies (IT) outsourcing software services, and cloud-based services in Israel and internationally. Its Software Services segment develops, markets, sells, and supports application platform, software applications, and business and process integration solutions and related services.