What Happened?
Shares of construction management software maker Procore (NYSE:PCOR) jumped 13.9% in the afternoon session after the company reported strong fourth-quarter 2024 results as its revenue and billings exceeded analysts' expectations, and full-year revenue guidance came in slightly above Wall Street's estimates. Sales grew 16% y/y, fueled by strong customer expansion and increased adoption of its software platform, particularly among high-value clients, with the number of customers generating over $1 million in annual recurring revenue, rising 39%y/y. On the other hand, its EPS missed, as operating margins fell sharply. Overall, this was a mixed quarter.
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What The Market Is Telling Us
Procore’s shares are not very volatile and have only had 7 moves greater than 5% over the last year. Moves this big are rare for Procore and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 7 months ago when the stock dropped 26.4% on the news that the company reported second-quarter earnings results. Its revenue guidance for the next quarter missed, and its customer growth decelerated. We do note the company slightly lifted its full-year revenue outlook, but the market seems to be more focused on the short term.
Overall, this was a mediocre quarter for Procore Technologies. Following the results, Wall Street analysts downgraded the stock's rating. DA Davidson downgraded the stock from Buy to Neutral, adding that " the company's Q2 print signaled significant company-wide operating model changes to come."
Procore is up 16.1% since the beginning of the year, and at $87.28 per share, has set a new 52-week high. Investors who bought $1,000 worth of Procore’s shares at the IPO in May 2021 would now be looking at an investment worth $991.76.
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