Earnings season has reached its peak, providing ample volatility for traders to take advantage of. Today, one of the stocks that remains in focus for many investors is Bill.com (NYSE:BILL). Indeed, BILL stock has seen gains of more than 27% at the time of writing on very heavy volume. Approximately 8.2 million shares have traded hands, relative to an average daily volume of around 1 million shares.
Today’ move appears to be the result of a culmination of factors. As a cloud-based software company, Bill.com certainly has its fair share of catalysts. Indeed, from a business model perspective alone, investors have ample reason to stick with this company. Its focus on providing AI-enabled solutions for customers looking for accounts payable and accounts receivable solutions is worth taking a look at.
However, today, two key catalysts appear to be materializing for Bill.com. Let’s dive into what these are.
Why BILL Stock Is Taking Off Today
The first and most pertinent reason for today’s rapid rise in BILL stock is the company’s earnings report issued yesterday.
Bill.com reported its fiscal fourth-quarter earnings, beating analyst expectations on the top line. Revenue grew by 86% year-over-year to $78 million this past quarter. This move was much more significant than what analysts expected — around $62 million. Accordingly, the top-line growth story with this stock remains strong today. Long-term growth investors seem to like Bill.com’s growth prospects and are pricing in faster-than-expected growth over the longer term.
That said, on the bottom line, Bill.com underperformed expectations. The company posted a loss of 48 cents per share, compared to 13 cents per share a year ago. Adjusted for one-time items, this loss still came in at 7 cents per share, which was higher than expectations. However, investors seem to only care about the top-line numbers when it comes to Bill.com and are reacting accordingly.
Additionally, today is providing a market-boosting catalyst, which has taken shares of most growth stocks higher. Federal Reserve Chairman Jerome Powell gave his highly anticipated Jackson Hole speech today. This speech has been largely viewed as dovish by investors, boosting the valuations of many highly priced stocks.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
