BLKB · Blackbaud
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $64.30
Note written ·
Price against the kill line
15.8% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $64.30, on record since 11 November 2026. The shares are up 24.8% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $64.30, just under the 52-week intraday high of $64.84 on 17 December 2025, which would show the shares leading the S&P 500. Fourth-quarter 2026 organic revenue growth above the 4.1% of the third quarter, with a 2027 revenue guide faster than 2026, would also show it.
Research onlyNot in the portfolio.
Key figures from the filings · Technology
Quarter to 30 September 2026, filed 28 October 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 293
- Revenue, change on a year (%)
- +4.1
- Gross margin (%)
- 60.8
- Operating margin (%)
- 20.5
- Free cash flow, four quarters ($M)
- 332
- Net cash, cash less debt ($M)
- −1,009
- Price to earnings (×)
- 16.3
- Enterprise value to sales (×)
- 3.0
All filed numbers
What Blackbaud reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 293 | +4.1 | 60.8 | 20.5 |
| first filed | 291 | +3.0 | 61.3 | 21.3 |
| first filed | 281 | +4.2 | 59.2 | 18.3 |
| first filed | 295 | −2.3 | 58.4 | 20.0 |
| first filed | 281 | −1.9 | 59.6 | 19.4 |
| first filed restated | 282 | −1.8 | 59.7 | 20.3 |
| Pre-tax income ($M) | 46.4 |
| Net income ($M) four quarters: 149 | 46.1 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | −7.3 |
| Operating cash flow ($M) | 342 |
| Capital spending ($M) | 10.3 |
| Free cash flow ($M) | 332 |
| Cash and short-term investments ($M) | 35.7 |
| Debt ($M) non-current long-term debt plus current maturities | 1,045 |
| Net cash, cash less debt ($M) | −1,009 |
| Deferred revenue ($M) −0.1% on a year | 385 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 76.2 |
| Inventory ($M) | Not reported |
| Shareholders' equity ($M) | 120 |
| Market value ($M) | 2,436 |
| Enterprise value, market value plus net debt ($M) | 3,445 |
| Enterprise value to sales (×) | 3.0 |
| Enterprise value to operating income (×) | 14.8 |
| Price to earnings (×) | 16.3 |
| Price to book value (×) | 20.4 |
| Free-cash-flow yield (%) | 13.6 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 7.5% of shares outstanding sold short, 8.0 days of average trading to cover, +0.5% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $2.0M |
| 12 monthsfrom | $0 | $5.9M |
The thesis
Blackbaud's shares are more likely to lag the S&P 500 over the next three months. The third-quarter report on 28 October 2026 held the upper-half 2026 outlook, but management expects a renewal cohort about 40% larger than 2025's to slow contract growth through the first half of 2027. The fourth-quarter report and first 2027 guide, estimated for around 10 February 2027, settle whether growth holds through that cycle.
The third quarter removed a near-term worry. Non-GAAP organic revenue grew 4.1%, up from 3.0% in the second quarter, and Blackbaud reaffirmed 2026 revenue of $1.173–1.179 billion. Revenue of $292.6 million still came in under Benzinga's $293.935 million consensus, while non-GAAP earnings per share (EPS) of $1.36 beat the $1.33 estimate. A smaller share count helped the EPS result.
The market has already paid for the recovery. The shares closed at $53.56 on 12 November 2026, up 18.4% over three months and well above the 200-day average of $41.22. No dated catalyst falls inside the next 30 days.
Bullish and bearish views on Blackbaud, Inc.
The bull case on Blackbaud, Inc. (BLKB), in brief: organic growth recovered in the third quarter. The bear case: a larger renewal cohort slows contract growth.
Bull case
- Organic growth recovered in the third quarter. Non-GAAP organic revenue grew 4.1% in the quarter ended 30 September 2026, against 3.0% in the second quarter, per Blackbaud's 28 October 2026 results release. Recurring revenue was $287.0 million, 98.1% of the total.
- Margins widened. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was $111.1 million in the third quarter, a 38.0% margin, up 260 basis points from a year earlier. Non-GAAP free cash flow was $126.0 million, a 43.1% margin, per the Form 8-K exhibit.
- The upper-half outlook survived the report. On 28 October 2026 Blackbaud reaffirmed adjusted EBITDA of $430–438 million, non-GAAP EPS of $5.15–$5.25 and free cash flow of $280–290 million. It expects the upper half of all four ranges and of the revenue range.
- Buybacks keep shrinking the share count. Shares outstanding fell to 45,102,406 on 30 September 2026 from 46,705,325 on 31 December 2025. The 2026 repurchase outlook is 7% to 10% of year-end 2025 shares, and about $832 million of authorization remained.
- Debt is falling. Chief Financial Officer Chad Anderson said the leverage ratio fell to 2.3 times in the third quarter from 2.7 times in the first. Total debt was about $1.04 billion on 30 September 2026.
Bear case
- A larger renewal cohort slows contract growth. On the 28 October 2026 call, management said the 2026 contractual recurring revenue renewal cohort is about 40% larger than 2025's. It expects that to moderate contractual recurring growth through the first half of 2027, per Quartr's call summary.
- Revenue missed again. Third-quarter revenue of $292.6 million trailed the $293.935 million consensus on 28 October 2026, per Benzinga. The EPS beat leaned on buybacks.
- Guidance was reaffirmed, not raised. Benzinga showed the $5.15–$5.25 EPS range against a $5.25 consensus estimate on 28 October 2026. The estimates already sit at the top of the range.
- Insiders sold into the rally. Director Andrew Leitch sold 18,000 shares at an average of $53.70 on 6 November 2026, per an SEC Form 4 filed 10 November 2026. Chief Executive Michael Gianoni sold 17,000 shares at $47.35 on 25 August 2026.
- The AI products have no reported revenue. The third-quarter release says Lantern, the fundraising language model built with Databricks, will be embedded in the platform starting in 2027. It gave no AI adoption or revenue figures.
Price setup
Blackbaud closed at $53.56 on 12 November 2026. That is 17.4% below the 52-week intraday high of $64.84 set on 17 December 2025. It is 18.4% above the three-month reference close of $45.25 on 14 August 2026.
The shares closed at $55.80 on 5 November 2026, $54.12 on 6 November 2026 and $54.92 on 10 November 2026, then slipped to $54.40 and $53.56. They did not rise after the 28 October 2026 report. The 50-day average is $48.42 and the 200-day average is $41.22, both as of 12 November 2026. The 52-week closing low was $26.54 on 22 June 2026.
The company issued no stock into the rally and is retiring shares. Retail attention is hard to measure, because "BLKB" also tags a Swiss cantonal bank in news feeds. The next scheduled report is about three months away.
Catalysts ahead
- ~10 February 2027 (est.): Fourth-quarter 2026 results and first 2027 guidance (date estimated from the 10 February 2026 precedent). Shows whether Blackbaud finished 2026 in the upper half of its ranges and how much the 40% larger renewal cohort slows 2027 organic growth.
What would change the view
A daily close above $64.30, just under the 52-week intraday high of $64.84 on 17 December 2025, which would show the shares leading the S&P 500. Fourth-quarter 2026 organic revenue growth above the 4.1% of the third quarter, with a 2027 revenue guide faster than 2026, would also show it.
What it trades with
Blackbaud trades with mid-cap cloud software. Its customers are nonprofits, schools and healthcare foundations, so charitable-giving trends and nonprofit budgets feed into renewals. About $1.04 billion of debt on 30 September 2026 links the shares to interest-rate moves.
News keyed on "BLKB" often concerns Basellandschaftliche Kantonalbank. A parliamentary commission pushed its final report on that bank to the second quarter of 2027, per a 28 October 2026 fiscal.ai item. Those items have no bearing on Blackbaud.
The evidence, claim by claim (8)
- Third-quarter 2026 revenue was $292.6 million; non-GAAP organic revenue grew 4.1%; recurring revenue was $287.0 million, 98.1% of the total. Blackbaud third-quarter 2026 results, Form 8-K Exhibit 99.1 · as of
- Third-quarter non-GAAP EPS of $1.36 beat the $1.33 estimate; revenue of $292.641 million missed the $293.935 million estimate. Benzinga, 28 October 2026 · as of
- Blackbaud reaffirmed 2026 revenue of $1.173–1.179 billion, adjusted EBITDA of $430–438 million, non-GAAP EPS of $5.15–$5.25 and free cash flow of $280–290 million, and expects the upper half of all four. Blackbaud third-quarter 2026 results, Form 8-K Exhibit 99.1 · as of
- Third-quarter adjusted EBITDA was $111.1 million, a 38.0% margin, up 260 basis points; non-GAAP free cash flow was $126.0 million, a 43.1% margin. Blackbaud third-quarter 2026 results, Form 8-K Exhibit 99.1 · as of
- Shares outstanding fell to 45,102,406 from 46,705,325 at 31 December 2025; the 2026 repurchase outlook is 7% to 10% of year-end 2025 shares; about $832 million of authorization remained. Blackbaud third-quarter 2026 results, Form 8-K Exhibit 99.1 · as of
- Management said the 2026 contractual recurring revenue renewal cohort is about 40% larger than 2025's and will moderate contractual recurring growth through the first half of 2027. Third-quarter 2026 earnings call, Quartr summary · as of
- Director Andrew Leitch sold 18,000 shares in the open market at an average of $53.70 on 6 November 2026. SEC Form 4 filed 10 November 2026 · as of
- Blackbaud reported fourth-quarter and full-year 2025 results and 2026 guidance on 10 February 2026, the precedent for the timing of the next annual report. Blackbaud date announcement, 27 January 2026 · as of
Sources
- BLACKBAUD INC - Form 8-K - FY2026 · sec.gov
- Blackbaud (BLKB) Q3 2026 earnings summary · quartr.com
- Blackbaud Q3 2026: EPS Beats on Buybacks, Revenue Misses Narrowly · 247wallst.com
- Company will also discuss long term aspirational goals and recent AI Innovation · barchart.com
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