Shares of Daily Journal Corporation DJCO have declined 2.2% since the company reported its earnings for the quarter ended Dec. 31, 2024. This compares to the S&P 500 index’s 0.2% decline over the same time frame. Over the past month, the stock has declined 10.3% against the S&P 500’s 0.2% growth.
See the Zacks Earnings Calendar to stay ahead of market-making news.
Daily Journal reported a net income of $7.91 per share for the three months ended Dec. 31, 2024, down from $9.16 per share a year earlier.
The company’s consolidated revenues of $17.7 million indicate an increase of 10.7% from $16 million in the prior-year period. The growth was primarily driven by Journal Technologies’ license and maintenance fee revenue, which rose by $1 million, and an increase of $1.2 million in other public service fees. These gains were partially offset by a $0.7 million decline in consulting fees. The Traditional Business segment contributed a modest revenue increase, with advertising revenues rising $0.2 million and service fees adding $0.03 million.
The company’s consolidated pretax income declined 5.4% to $14.9 million from $15.7 million in the prior-year period. Net income fell to $10.9 million from $12.6 million a year earlier. The decline was influenced by a reduction in non-operating income and a higher income tax provision.
Daily Journal Corporation Price, Consensus and EPS Surprise
Daily Journal Corporation price-consensus-eps-surprise-chart | Daily Journal Corporation Quote
DJCO’s Key Business Metrics
Journal Technologies, one of Daily Journal’s primary business segments, saw its pretax income rise $0.1 million to $0.5 million. This improvement was supported by a $1.5 million increase in operating revenues. However, higher operating expenses of $1.4 million offset some of the gains. The rise in costs was mainly due to increased personnel expenses, additional contractor services, and higher third-party hosting fees.
The company’s non-operating income, net of expenses, dropped by $1 million to $14.2 million. A key driver was the recording of net unrealized gains on marketable securities, which totaled $13.4 million compared to $14.7 million in the prior-year period. Additionally, dividend and interest income declined by $0.4 million to $1.2 million.
Factors Influencing Performance
Daily Journal’s revenue growth was largely driven by increased software-related revenues in its Journal Technologies business. However, rising costs, particularly personnel expenses, contractor services and third-party hosting fees, weighed on operating profits. The company also faced reduced non-operating income, primarily due to lower unrealized gains on its investment portfolio and a decline in interest and dividend income.
The income tax provision for the quarter was $4 million, leading to an effective tax rate of 26.9%. This tax impact further contributed to the decline in net income compared to the prior-year period.
Other Developments
As of Dec. 31, 2024, Daily Journal held marketable securities valued at $372.1 million, with net pretax unrealized gains of $233 million. The company also accrued a deferred tax liability of $60.8 million related to estimated income taxes on these unrealized gains.
Research Chief Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners Up
Daily Journal Corp. (S.C.) (DJCO): Free Stock Analysis Report