Why Digital Turbine Stock Is Skyrocketing Today

Digital Turbine (NASDAQ: APPS) stock is soaring higher in Tuesday's trading. The advertising technology company's share price was up 49.7% as of 11 a.m. ET amid the backdrop of a 0.3% decline for the S&P 500 (SNPINDEX: ^GSPC).

After yesterday's market close, Digital Turbine published results for the fourth quarter of its last fiscal year, which ended March 31. In addition to posting quarterly sales and earnings that beat the market's expectations, the company also issued strong forward performance guidance.

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Digital Turbine stock surges on fiscal Q4 beats

Digital Turbine recorded non-GAAP (generally accepted accounting principles) adjusted earnings per share of $0.10 on sales of $119.15 million in fiscal Q4. The performance crashed the average Wall Street analyst estimate, which had called for adjusted earnings per share of $0.04 on sales of $116.64 million. The business's revenue increased roughly 6% year over year in the period. While the company's per-share profit declined from $0.12 in the prior-year quarter, the performance was still far better than investors had anticipated.

What's next for Digital Turbine?

Along with better-than-expected number's for last year's fiscal Q4, Digital Turbine also issued encouraging targets for its current fiscal year. The company expects sales for the period to come in between $515 million and $525 million. At the midpoint of the guidance range, that would mean delivering annual growth of approximately 6% over the $490.5 million in sales posted last fiscal year. For comparison, the average estimate had called for the business to guide for sales of $519.5 million for the year.

Digital Turbine's guidance for adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) also beat Wall Street's expectations, with management's target for adjusted EBITDA between $85 million and $90 million coming in significantly better than the average estimate's call for adjusted EBITDA of $85.2 million. With better-than-anticipated performance and outlooks for sales and profitability, Digital Turbine is looking significantly stronger coming out of its latest earnings report.

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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.