Why Bill Holdings Stock Popped Today

Shares of Bill Holdings (NYSE: BILL) were among the winners Monday. The software company that specializes in back-office accounting and payments for small and medium-sized businesses (SMBs) continued to gain following last Friday's pop on a better-than-expected earnings report. The stock seemed to benefit from a broader upward trend in fintech stocks today.

As a result, Bill finished up 11.1% on Monday.

Image source: Getty Images.

Bill is suddenly in rally mode

Bill, the owner of Bill.com, had been struggling for years with sluggish growth in the SMB and software market, but investors seem to expect that to change in the Trump era as financial stocks, including Bill, have soared since the election. Bill is up 45% over the last four sessions.

A strong first-quarter earnings report last Thursday also drove momentum in the stock as revenue rose 18% to $358.6 million, ahead of the consensus at $348.9 million, and adjusted earnings per share of $0.63 up from $0.44 in the quarter a year ago, which was also ahead of the consensus at $0.50.

Bill also raised its guidance for the fiscal year, calling for revenue of $1.439 billion to $1.464 billion and adjusted earnings per share (EPS) of $1.65 to $1.83, compared to the consensus at $1.55.

Wall Street analysts responded to the report with price target hikes, and payments stocks rose today in response to the rise in crypto prices and continued hopes for deregulation.

Small-cap stocks were also big winners today as the Russell 2000 jumped 1.5%. Investors continue to bet that Trump policies will favor small-cap stocks, which are more volatile than large caps. If that is the case, it should also help the small and medium-size businesses that make up Bill's customer base.

Can Bill keep gaining?

Bill was a big winner during the pandemic, though the stock has since given back much of those gains. However, the business is cyclical and should benefit if there is an economic boom over the coming years, which investors seem to be betting on.

It's still unclear if that will play out, but the recent earnings report is certainly a positive sign for the company.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Amazon: if you invested $1,000 when we doubled down in 2010, you’d have $23,446!*
• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $42,982!*
• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $428,758!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

See 3 “Double Down” stocks »

*Stock Advisor returns as of November 11, 2024

Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bill Holdings. The Motley Fool has a disclosure policy.