Bank systems stocks staged a spirited rally last week, driven by mostly higher earnings reports and a buying spree in technology issues overall.
Quarterly profits coming from financial technology firms were mostly higher, and generally in line or above Wall Street analysts' estimates.
One notable upside earnings surprise came from banking software developer Hogan Systems Inc. that reported sharply higher revenues and profits for its fourth fiscal quarter of 1995 that ended March 31.
Dallas-based Hogan reported net income of $4.6 million, or 31 cents per share, for the period, compared with $2.5 million, or 16 cents per share, for the fourth fiscal quarter of 1994.
An analysts' consensus published by First Call Corp. had expected Hogan to report earnings of 17 cents per share for the last quarter.
"This is our highest quarterly earnings in 10 years," said Hogan chairman and chief executive officer Michael H. Anderson in telephone conference call with analysts. "We are in a cash-generating position that looks strong and should continue into next year."
Mr. Anderson noted that software license sales for the quarter were particularly strong, exceeding $7 million. He added that one of the company's biggest contracts was with Huntington Bancshares. The Columbus, Ohio, regional bank plans to install a suite of Hogan software products, he said.
After spending millions of dollars to revamp its software over the past two years, the Huntington deal "is an endorsement that the investments we've been making have high value to those (banks) who are on the sophisticated edge of using technology," Mr. Anderson said.
Hogan's common stock closed at TK per share Friday, up TK for the week.
Payments processor First Financial Management Corp. also announced sharply higher revenues and earnings for the first quarter.
In the three months ended March 31, Atlanta-based First Financial said revenues rose 48% to $684 million from the year-earlier period.
Net income for the quarter increased 20% from the corresponding period in 1994, to $35.4 million.
Earnings per share hit 56 cents, compared with 47 for the first quarter of 1994. On average, analysts had anticipated First Financial's earnings to reach 55 cents per share for the quarter, according to First Call.
"Our record performance in the first quarter reflects the continued strong momentum in our business," said Patrick H. Thomas, First Financial's chairman and chief executive officer. "I'm especially pleased with the strong performance turned in by (funds transfer subsidiary) Western Union during its first full quarter as an First Financial company. Their money transfer business is rapidly accelerating outside the United States, as reflected by their entry into China that we announced during the quarter."
First Financial's common stock ended the week at $TK per share, up $TK.
Community bank software developer Jack Henry & Associates Inc. said its earnings rose for the third fiscal quarter of 1995 that ended March 31.
Net income for the quarter reached $1.8 million, or 15 cents per share, compared with $1.3 million, or 11 cents per share, for the year-earlier period. Analysts on average were expecting earnings of 14 cents per share, according to First Call.
Jack Henry officials said part of the earnings rise was due to a 50% increase in maintenance support and service revenues for the quarter.