The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how CSG (NASDAQ: CSGS) and the rest of the data & business process services stocks fared in Q1.
A combination of increasing reliance on data and analytics across various industries and the desire for cost efficiency through outsourcing could mean that companies in this space gain. As functions such as payroll, HR, and credit risk assessment rely on more digitization, key players in the data & business process services industry could be increased demand. On the other hand, the sector faces headwinds from growing regulatory scrutiny on data privacy and security, with laws like GDPR and evolving U.S. regulations potentially limiting data collection and monetization strategies. Additionally, rising cyber threats pose risks to firms handling sensitive personal and financial information, creating outsized headline risk when things go wrong in this area.
The 11 data & business process services stocks we track reported a satisfactory Q1. As a group, revenues beat analysts’ consensus estimates by 1.3% while next quarter’s revenue guidance was in line.
Thankfully, share prices of the companies have been resilient as they are up 6.8% on average since the latest earnings results.
Best Q1: CSG (NASDAQ: CSGS)
Powering billions of critical customer interactions annually, CSG Systems (NASDAQ: CSGS) provides cloud-based software platforms that help companies manage customer interactions, process payments, and monetize their services.
CSG reported revenues of $299.5 million, up 1.5% year on year. This print exceeded analysts’ expectations by 1.4%. Overall, it was an exceptional quarter for the company with full-year revenue guidance exceeding analysts’ expectations and a solid beat of analysts’ EPS estimates.
“Team CSG’s strong first quarter results enabled us to raise our 2025 non-GAAP profitability and EPS guidance targets. We grew revenue nicely at customers outside of communication service providers (“CSPs”) with a third of our revenue now coming from big, faster growing industry verticals providing a buffer against today’s macro-economic uncertainty.” said Brian Shepherd, President and Chief Executive Officer of CSG.
CSG achieved the highest full-year guidance raise but had the slowest revenue growth of the whole group. Unsurprisingly, the stock is up 3.9% since reporting and currently trades at $63.73.
Is now the time to buy CSG? Access our full analysis of the earnings results here, it’s free.
Planet Labs (NYSE: PL)
Pioneering the concept of "agile aerospace" with hundreds of small but powerful satellites, Planet Labs (NYSE: PL) operates the world's largest fleet of Earth observation satellites, capturing daily images of our planet to provide insights on deforestation, agriculture, and climate change.
Planet Labs reported revenues of $66.27 million, up 9.6% year on year, outperforming analysts’ expectations by 6.5%. The business had a very strong quarter with an impressive beat of analysts’ EPS estimates and full-year revenue guidance slightly topping analysts’ expectations.
Planet Labs pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 36.2% since reporting. It currently trades at $5.46.
Is now the time to buy Planet Labs? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: Broadridge (NYSE: BR)
Processing over $10 trillion in equity and fixed income trades daily and managing proxy voting for over 800 million equity positions, Broadridge Financial Solutions (NYSE: BR) provides technology-driven solutions that power investing, governance, and communications for banks, broker-dealers, asset managers, and public companies.
Broadridge reported revenues of $1.81 billion, up 4.9% year on year, falling short of analysts’ expectations by 2.5%. It was a slower quarter, leaving some shareholders looking for more.
Broadridge delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 1.6% since the results and currently trades at $238.16.
Read our full analysis of Broadridge’s results here.
CoStar (NASDAQ: CSGP)
With a research department that makes over 10,000 property updates daily to its 35-year-old database, CoStar Group (NASDAQ: CSGP) provides comprehensive real estate data, analytics, and online marketplaces for commercial and residential properties in the U.S. and U.K.
CoStar reported revenues of $732.2 million, up 11.5% year on year. This number met analysts’ expectations. It was a strong quarter as it also produced an impressive beat of analysts’ EPS estimates and revenue guidance for next quarter meeting analysts’ expectations.
CoStar had the weakest full-year guidance update among its peers. The stock is down 2.2% since reporting and currently trades at $80.76.
Read our full, actionable report on CoStar here, it’s free.
Dun & Bradstreet (NYSE: DNB)
Known for its proprietary D-U-N-S Number that serves as a unique identifier for businesses worldwide, Dun & Bradstreet (NYSE: DNB) provides business decisioning data and analytics that help companies evaluate credit risks, verify suppliers, enhance sales productivity, and gain market visibility.
Dun & Bradstreet reported revenues of $579.8 million, up 2.7% year on year. This result was in line with analysts’ expectations. Overall, it was a strong quarter as it also recorded a decent beat of analysts’ EPS estimates.
The stock is up 1.2% since reporting and currently trades at $9.07.
Read our full, actionable report on Dun & Bradstreet here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
