Analyst Note| Rajiv Bhatia, CFA |
Narrow-moat-rated SS&C reported solid financial results during its fourth quarter. Adjusted revenue was $1.21 billion, beating the FactSet consensus estimate of $1.16 billion. Adjusted earnings were $1.13 beating the consensus by $0.08. Constant currency revenue declined 2% during the quarter and declined 0.5% for the year, due in part to lower nonrecurring revenue and weakness at DST financial. As is customary, SS&C provided its initial 2021 outlook during its fourth-quarter earnings release. The midpoint of SS&C’s revenue and earnings 2021 outlook was roughly consistent with consensus estimates. Though we plan to tweak our model, we do not expect a large change to our fair value estimate of $63.