Bill.com Holdings, Inc. (BILL) experienced some volatility in the market over the past four months while also seeing some record growth. Hedge funds are buying, and the computer software company continues to outpace the S&P 500. Bill rose by approximately 83.9% compared to the S&P’s gain of about 28.0%, and Bill achieved a ranking of twelve on the WhaleWisdom Heatmap.
Bill provides cloud-based software for businesses to help them simplify and automate their back-office financial operations. The company has seen success with small and midsize companies opting for their end-to-end payment automation platform, Bill.com. Bill saw some negative impact in earnings throughout the coronavirus pandemic due to the business interruption and losses many customers faced. However, ultimately it seems that Bill has benefited from the transition of more businesses to automated processes during the pandemic. Bill continues to partner with many organizations such as financial institutions and accounting firms to provide banking and payment technology offerings and wealth management firms to support their clients with an automated and secure bill payment process.
Hedge Funds and Institutions Are Buying
Bill saw positive third-quarter activity from both hedge funds and institutions. Hedge funds increased their aggregate 13F shares held to approximately 28.9 million from about 21.5 million. Of hedge funds, 53 created new positions, 45 added to an existing holding, 16 exited, and 48 reduced their stakes. Institutions increased their aggregate holdings to about 94.3 million from 82.2 million.
Optimistic Revenue Estimates
The 13F metrics between 2019 and 2021 suggest that Bill’s strong investment potential. However, analysts predict an initial dip in earnings through to 2023, bringing profits to an estimated $0.71 by June 2023. Revenue estimates are encouraging at approximately $540.5 million by June 2022 and rising to about $734.1 million by June 2023.
Analysts Raise Price Targets
Many analysts view Bill as a stock to Buy. Jefferies analyst Samad Samana raised Bill’s price target to $350 from $300 and kept a Buy rating on shares, anticipating continued revenue growth. Canaccord Genuity analyst Joseph Vafi raised the firm’s price target to $366 from $284 and kept a Buy rating. Also, Peter Levine of Evercore ISI initiated coverage of the company with a $300 price target and an In-Line rating.
Bill’s performance is encouraging with strong 2021 year-to-date growth and hedge funds buying. Multi-year estimates speak to the stock’s long-term potential, and Bill has a strong position within the small and midsized business market. Analysts’ ratings and outlooks present an attractive opportunity for investors.