JCOM Takes Over EPA Cloud - Analyst Blog


j2 Global Inc. ( JCOM ), a leading provider of unified messaging capabilities, recently acquired a U.K.-based Email Security and Management company called EPA Cloud. The details of the acquisition remain undisclosed.

The company exited the second quarter of 2013 with a strong cash position of $352.9 million and record high revenues of $141.4 million, up 58% year over year, easily beating both the top and the bottom line of the Zacks Consensus Estimate.

Hence, we believe that a solid cash position coupled with a low debt-to-capitalization ratio of 0.28, has induced the company to pursue this acquisition. At present, j2 Global commands approximately 30% of the world's cloud-based digital faxing system.

Moreover, the company expects to benefit from increasing demand for cloud based, value-added communication, messaging and data backup services. As a result, the company has also raised its outlook for fiscal 2013.

j2 Global primarily depends on inorganic growth for expansion. Last year, the company made six acquisitions related to cloud-based services. The acquisitions were mainly across Europe and Australia with a total capital spending of nearly $198 million. The company executed four more buyouts early this year. The aggressive buy-out strategy of the company will consolidate its global leading position in the virtual PBX market.

Other Stocks to Consider

j2 Global currently has a Zacks Rank #3 (Hold). The other stocks in the Internet/Application software industry that are currently performing well include Textura Corp. ( TXTR ), Constant Contact, Inc. ( CTCT ) and Responsys, Inc. ( MKTG ). All three currently have a Zacks Rank #2 (Buy).

CONSTANT CONTAC (CTCT): Free Stock Analysis Report

J2 GLOBAL INC (JCOM): Free Stock Analysis Report

RESPONSYS INC (MKTG): Free Stock Analysis Report

TEXTURA CORP (TXTR): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: CTCT , JCOM , MKTG , TXTR



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