BLP’s Rearview Mirror for the Week Ending November 10th

What’s Happenin’?

Week Ending November 10th

Earnings, IPOs, Mergers & Acquisitions, Private Placements

Source:  myoldpostcards / Foter.com / CC BY-NC-ND
Source: myoldpostcards / Foter.com / CC BY-NC-ND

Tell me what is good about daylight savings time?  It is now sunset at 4:20pm.  What’s up with that?  Makes for walking the dogs in the dark with a headlamp, reflector vest and, reflector harness and LED lights on the dogs.  Quite a picture!

Earnings

Another long, long list of companies reporting earnings. Here are a few we found of interest:

Activision’s (ATVI:  Nasdaq) revenues and net income exceeded expectations, on the release of two new titles:  Call of Duty:  Ghosts,and Skylanders Swap Force.  ATVI reported revenue of $691m down from $841m, but net income of $0.05, up from $0.03 per share.  The outlook is uncertain due to “console transition.”

BroadSoft (BSFT:  Nasdaq)) had weak 3Q results, where revenue rose 7 percent to $42.9m, below analysts’ estimate of $45.2m.  The net loss was $(4.1)m or ($0.14) per share.  Broadsoft claims to be the leading global provider of software that enables mobile, fixed-line and cable service providers to deliver real-time communications over their IP networks.

Cbeyond (CBEY:  Nasdaq) reported ($0.18), missing street estimated by $0.10—a mighty big miss.  Revenue was $113.7m and a loss of $5.4m.  CBEY provides integrated communications services, including internet access, and internet-based applications to small and medium sized businesses.

Extreme Networks (EXTR:  Nasdaq) reported a net loss of ($35,000), or pretty durn closed to breakeven.  This reflects lower revenues of $76m, which is basically unchanged from the year ago quarter.  Extreme Networks provides high performance, open networking solutions for enterprises, hosting companies and Internet Exchange Points.

HomeAway (AWAY:  Nasdaq) revenues increased 23 percent to $90.1m, and net income was $8.5m or $0.10 per share, 63 percent YOY.  HomeAway is the leading online marketplace for the vacation rental industry.  These guys own the vacation home rental market—as any vacation homeowner will attest.  The site is also the source of great deals for those going on vacation to places they’ve never gone before.

Zillow (Z:  Nasdaq) saw revenue increase to $53.3m, a 67 percent increase YOY, and a loss of ($1.2m) or breakeven at ($0.03) per share.  Zillow engages in the operation of a real estate and home-related information marketplace on mobile, and the web.

IPOs[2]

If you were a company that went public this week, and weren’t Twitter, not a lot of people wanted to attend your party.  However, since there wasn’t a lot of Twitter stock to be found, there was still plenty of room for you, as these deals can attest.  If a deal like MVNR can go public—it’s a Bull Market, for sure.

Barracuda Networks  (CUDA:  NYSE) sold 4.1m shares at $18 per share, the low end of the range, to raise $72m at a   $900m valuation.  The stock closed the week at $21.23 per share.  Barracuda designs and sells powerful, yet easy-to-use, security and storage solutions.  I can hear those durn radio ads, still.  The stock closed the week at $21.23  per share

Karyopharm Therapeutics (KPTI:  Nasdaq) sold 6.8m shares at $16 per share, raising $109m, at a $442m valuation.  The stock closed the week at $16.24 per share.  KPTI is focused on the discovery and development of novel drugs directed nuclear transport targets for the treatment of cancer and other major diseases.

Mavenir Systems (MVNR:  Nasdaq) sold 4.8m shares, below the $15 to $17 range, at $10 per share, raising $48m.   Mavenir closed the week at $9.25 per share.  The balance sheet is among the more convoluted that I have seen, with a $99 million shareholder deficit before the offering.

Mavenir sells a software-based telecommunications networking solutions that enable mobile service providers to deliver internet protocol (IP)-based voice, video, rich communications and enhanced messaging to their clients.

Yahoo Finance lists their market cap as $12.4 million—which has to be attributable to that massive debt.  Book value per share of ($74).  How did they sell themselves to investors??

Twitter  (TWTR:  Nasdaq) Need I say anything at all, except that I wish I had got some shares on the offering?

Wix.com  (WIX:  Nasdaq) sold 7.7m shares at $16.50 per share, raising $127m at a $601m valuation.  The stock closed the week at $17.30 per share.  Wix.com is based in Israel, and hosts a web development platform targeted at do-it-yourself SMB users.

There remain many, many hot deals to come:  AirBNB, Box, Dropbox, Snapchat, Pinterest, Evernote, and Square, to name a few.

Mergers & Acquisitions

Santarus (SNTS:  Nasdaq), which develops treatments for diabetes and heartburn, was acquired by Salix Pharmaceuticals, which makes drugs for intestinal diseases, for $2.6b.

GXS, which calls itself “the leader in B2B integration:  frictionless interaction between companies—from the cloud to the client,” acquired by Toronto-based, OpenText, a leader in enterprise information management, for $1.2b

Bushnell, a developer and manufacturer of high-performance sports optics, was acquired by Alliant Techsystems, a supplier of aerospace and defense products, for $985m.

Everis, a multinational consulting firm, was acquired by NTT Data for 559m EUR

Living Social’s Ticket Monster acquired by Groupon for $260m.  Ticket Monster is a deal site for sports, theater, concerts and other events tickets, based in South Korea.

SiteScount, a self-serve advertising platform for buying online banner ad space, was acquired by Centro, a developer of smart media management software for advertisers, for $40m.

Sold, an ecommerce middleman service, where via an online app, will sell your product, and then manage the shipping for you, was acquired by Dropbox

Private Placements

Nextdoor, which is a private social network of your neighborhood, raised a $60m Series C round

Mobli, a “real-time visual media platform” raised a $60m strategic investment from América Móvil, a wireless provider in South America

Linio, an on-line marketplace in Mexico, Colombia, Peru and Venezuela, raised $50m from Latin Idea, along with current investors.

Zomato, a type of Yelp that serves India, raised a Series D round of $37m.

Sonos, which develops and sells a system of HiFi wireless speakers and audio components, raised $26m.  Sonos is definitely the high-priced spread.  We’ve been able to implement a similar solution at a fraction of the price.

COHO Data, which is enabling businesses to build their own high performance Amazon-style storage for their data, raised $25m Series B round.

2nd Watch, a leader in building, deploying and managing Amazon Web Services, raised a $23m round.

Gainsight, pioneering “Customer Success Management” with a data and software driven solution, raised a $20m Series B round.

Jut, a stealth big data startup, raised a $20m Series B.

Project Frog, a leader in creating smart, energy efficient [component] buildings, raised $20m Series D

Betable, an online gaming platform, raised an $18m Series A round.

Sprinklr, which has developed a social media management systems for the enterprise, raised $17.5m.

Switzerland-based, coresystems raised a $15.5m Series A for its iPad app that helps enterprise organizations manage their field operations.   The headline reads “Coresystems raises $15.5M to ensure nuclear power plants are in tip-top shape.”

FieldAware, a system to manage field service operations, raised 11m EUR

Xangati, a leading provider of cloud, VDI and workload performance management and live, continuous performance monitoring solutions, raised $11m Series C

Have a great week and enjoy the last of the leaf cleanup from your yard.

Margaret Johns

Founder & Chairman

Content researched, edited and reviewed on a best efforts basis.

We make no claim to being comprehensive in our review, as the contents are companies and topics we, ourselves, find of interest.

 


[1] Certain information provided by Renaissance Capital, in addition to the SEC and numerous business publications