) isn't jiving with analysts as they see earnings to continue to
move lower. As a Zacks Rank #4 (Sell), it is the Bull of the Day.
Do We Have Enough Social Networks?
Jive is looking to get businesses use their software to increase
collaboration, content movement and enterprise portals / intranets.
Jive's mission is to change the way work gets done, but with nearly
1 billion Facebook users, 175M LinkedIn members and about 400
million tweets a day, are they late to the game?
Jive Software, Inc. provides a social business software platform to
businesses, government agencies, and other enterprises. Its Jive
Engage Platform enables collaboration across two principal
communities and employees within the enterprise, and customers and
partners outside the enterprise. The company's Jive Engage Platform
is used as a communications tool and collaborative workspace that
supports and enhances knowledge sharing, facilitates communication
within and across organizational boundaries, and enables
individuals to work together to achieve common business goals.
JIVE Hasn't Beat Over The Last Year
Dating back to the December 2011 quarter, which was the last time
that the company posted a positive earnings surprise. Of the five
quarters since that time, there have been two meets and 3 negative
Losses Increase as Revenues Grow
When you see a stock that has revenues increase and earnings per
share decrease you start to scratch your head. Jive has posted
revenue of $27M, $29M, $33M and $34M in each of the last four
quarters respectively. Over the same period reported earnings per
share fell from -$0.18, -$0.17, -$0.23, -$0.24. So the losses are
getting bigger as revenues increase.
Projected Earnings Growth Drops
Topline growth has shown up, but the bottom line is projected to
only see extended losses in 2013 and 2014. Just in the last six
months, the Zacks Consensus Estimate for 2013 has moved from a loss
of $0.47 to a loss of $1.06, a significant drop. At the same time,
2014 is not getting any better. In November 2012, the 2014 estimate
moved from -$0.29 to the current level of a loss of $1.00.
The valuation picture for JIVE is a challenging one due to the
negative earnings. The stand by valuation metrics like Price to
Earnings are all not meaningful due to the negative earnings. Price
to book of 8.3x is almost double that of the industry average. The
price to sales metric also shows a significant premium as well.
Still the company is projected to see revenue growth of 33% this
year and 29% next year. Earnings growth of -47% for 2013 is a major
detractor, but 5.7% growth in earnings for 2014 shows that there is
light at the end of the tunnel. The problem is the tunnel is
A quick look at the price and consensus shows that the young
company debuted with some high expectations. Since that time
analysts have continued to move their earnings estimates lower and
lower. With the stock comfortably in the teens, shareholders are
more than likely going to stick with it until single digits appear
Brian Bolan is a Stock Strategist for Zacks.com. He is the Editor
in charge of the
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JIVE SOFTWARE (JIVE): Free Stock Analysis
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