BroadVision (BVSN)'s #1 competitor in the B2B social networking industry Jive Software (JIVE) just began trading after its IPO today and it is currently up $3 from its IPO price of $12 to a price of $15 per share! JIVE is clearly one of the hottest IPOs of 2011. This bodes extremely well for NIA's new largest position BVSN!
The demand for JIVE shares is amazing! Investors are clearly willing to pay huge premiums for stocks in the rapidly growing B2B social networking industry and NIA believes it is only a matter of time before investors who are buying JIVE discover BVSN and realize how insanely undervalued BVSN currently is at $9.50, being that BVSN is trading below its cash position of $12.58 per share!
JIVE's current market cap at $15 is about $885 million. If we estimate JIVE's enterprise value by subtracting its cash raised today of $161.3 million from its current market cap, JIVE has an enterprise value of approximately $723.7 million. JIVE only has $69 million in revenues and lost $38.1 million in just the first nine months of the year. JIVE's enterprise value is currently about 10.49 times sales.
BVSN only has 4.516 million shares outstanding and a market cap at $9.50 of $42.9 million. BVSN has $56.787 million in cash and no debt. BVSN's enterprise value is a negative $13.89 million. BVSN has revenues of $18.45 million and in the last nine months reported a net loss of only $3.576 million. If BVSN had an enterprise value of 10.49 times sales it would equal $193.54 million, which when added to BVSN's cash position would give BVSN a market cap of $250.327 million. That would equal a share price for BVSN of over $55!
Let us repeat, if BVSN's enterprise value was 10.49 times sales like JIVE's enterprise value is at $15 per share, BVSN would be worth $55 per share! Wall Street is paying a HUGE premium for JIVE when we believe BVSN's Clearvale B2B social networking platform is a lot better. BVSN's Clearvale not only allows businesses to provide separate social networks for employees, partners, and customers, but Clearvale allows them to integrate their Clearvale enabled networks with public social networks like Facebook and Twitter.
BVSN is perfectly positioned with JIVE in the B2B social networking space, which is already growing more rapidly than B2C social networking and is expected to grow from a 10% share of the social networking industry today to a 30% share by 2015! For Wall Street to be paying such a huge premium for JIVE, but to be valuing BVSN below cash, presents one of the biggest opportunities we have ever discovered!
NIA considers BVSN to be an absolute steal below its cash position of $12.58 per share. It is almost as if those who buy BVSN below $12.58 per share are receiving ownership in their business with $18.45 million in revenues for free. NIA sees almost no downside risk for BVSN at $9.50 per share, only huge upside potential!
Hedge funds associated with Palo Alto Investors, LLC, owned 749,469 shares or about 17% of BVSN as of February 14th, 2011. On September 30th, 2011, Palo Alto filed a schedule 13G reporting shared voting power of only 283,761 shares or about 6% of BVSN. In our opinion, Palo Alto associated funds faced redemptions and were forced to sell 465,708 shares of BVSN between February 14th and September 30th, which is what drove BVSN down to these artificially low levels.
We believe nobody in their right mind would sell BVSN below its $12.58 per share cash position unless they were forced to due to redemptions. It is possible that Palo Alto's position may have declined even lower in recent months and they could be almost out of shares. NIA believes once their selling is done, BVSN will quickly rise to where it belongs based on its fundamentals and Wall Street's demand for social networking stocks. A fair value for BVSN is probably well north of its cash position of $12.58 per share.
BVSN's 52-week high from back in April was $14.50 per share, but even $14.50 would only give BVSN an enterprise value of $8.67 million when BVSN's current revenues are $18.45 million. BVSN's biggest catalyst could come in 2012 when Facebook goes public! If Facebook receives its expected valuation of $100 billion, imagine the valuations that companies like BVSN and JIVE could trade at!
The demand for JIVE shares is amazing! Investors are clearly willing to pay huge premiums for stocks in the rapidly growing B2B social networking industry and NIA believes it is only a matter of time before investors who are buying JIVE discover BVSN and realize how insanely undervalued BVSN currently is at $9.50, being that BVSN is trading below its cash position of $12.58 per share!
JIVE's current market cap at $15 is about $885 million. If we estimate JIVE's enterprise value by subtracting its cash raised today of $161.3 million from its current market cap, JIVE has an enterprise value of approximately $723.7 million. JIVE only has $69 million in revenues and lost $38.1 million in just the first nine months of the year. JIVE's enterprise value is currently about 10.49 times sales.
BVSN only has 4.516 million shares outstanding and a market cap at $9.50 of $42.9 million. BVSN has $56.787 million in cash and no debt. BVSN's enterprise value is a negative $13.89 million. BVSN has revenues of $18.45 million and in the last nine months reported a net loss of only $3.576 million. If BVSN had an enterprise value of 10.49 times sales it would equal $193.54 million, which when added to BVSN's cash position would give BVSN a market cap of $250.327 million. That would equal a share price for BVSN of over $55!
Let us repeat, if BVSN's enterprise value was 10.49 times sales like JIVE's enterprise value is at $15 per share, BVSN would be worth $55 per share! Wall Street is paying a HUGE premium for JIVE when we believe BVSN's Clearvale B2B social networking platform is a lot better. BVSN's Clearvale not only allows businesses to provide separate social networks for employees, partners, and customers, but Clearvale allows them to integrate their Clearvale enabled networks with public social networks like Facebook and Twitter.
BVSN is perfectly positioned with JIVE in the B2B social networking space, which is already growing more rapidly than B2C social networking and is expected to grow from a 10% share of the social networking industry today to a 30% share by 2015! For Wall Street to be paying such a huge premium for JIVE, but to be valuing BVSN below cash, presents one of the biggest opportunities we have ever discovered!
NIA considers BVSN to be an absolute steal below its cash position of $12.58 per share. It is almost as if those who buy BVSN below $12.58 per share are receiving ownership in their business with $18.45 million in revenues for free. NIA sees almost no downside risk for BVSN at $9.50 per share, only huge upside potential!
Hedge funds associated with Palo Alto Investors, LLC, owned 749,469 shares or about 17% of BVSN as of February 14th, 2011. On September 30th, 2011, Palo Alto filed a schedule 13G reporting shared voting power of only 283,761 shares or about 6% of BVSN. In our opinion, Palo Alto associated funds faced redemptions and were forced to sell 465,708 shares of BVSN between February 14th and September 30th, which is what drove BVSN down to these artificially low levels.
We believe nobody in their right mind would sell BVSN below its $12.58 per share cash position unless they were forced to due to redemptions. It is possible that Palo Alto's position may have declined even lower in recent months and they could be almost out of shares. NIA believes once their selling is done, BVSN will quickly rise to where it belongs based on its fundamentals and Wall Street's demand for social networking stocks. A fair value for BVSN is probably well north of its cash position of $12.58 per share.
BVSN's 52-week high from back in April was $14.50 per share, but even $14.50 would only give BVSN an enterprise value of $8.67 million when BVSN's current revenues are $18.45 million. BVSN's biggest catalyst could come in 2012 when Facebook goes public! If Facebook receives its expected valuation of $100 billion, imagine the valuations that companies like BVSN and JIVE could trade at!
NIA strongly suggests visiting the following link to read what the media has been saying about BVSN along with news from BVSN and blog posts from BVSN's management about their social networking technology: http://www.broadvision.com/en/news.php
Disclaimer: NIA owns 122,000 shares of BVSN that it purchased at an average price of $8.6687 per share. NIA has agreed to a 60 day holding period on these shares but intends to sell its shares at some point in the future after the date of February 12th, 2012. NIA's co-founders have also been referred business in the past from somebody who has filed as a large BVSN shareholder.
NIA is not an investment advisor. This email is not a solicitation or recommendation to buy, sell, or hold securities. Never make investment decisions based on anything NIA says. This email is meant for informational and educational purposes only and does not provide investment advice. NIA's co-founders have previously disseminated information about BVSN in other media outlets.
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