Value in ValueClick

Posted: October 1, 2007 in Technology and Business
Somebody recently asked me why I always talk about Google and Yahoo.
Mostly because I think of them as a proxy for the overall online advertising business.
But, was hard not to notice ValueClick going from 36 to 18 over the last few months.
Why the plunge?
They missed earnings by a penny (17 cents vs. 18 cents).  Revenue was light.  They’re clearing up some legal issues with a smaller part of their business (lead generation).  And, of course, they haven’t gotten asked to dance by any of the popular kids… which makes them look unpopular… for now.
But like so many things on Wall Street, the plunge feels like a big overreaction.
Couple that with their solid operating metrics, cash position, zero debt, quarterly earnings growth, etc. — and compare valuations with the other, uhm, popular kids — and it’s hard not to think there’s value in ValueClick (VCLK).
Certainly, the last couple weeks of performance would concur.
Mostly, though, we’re in one of the biggest industry transitions in the history of commerce (offline-to-online advertising)… there’s no reason why VCLK won’t benefit from that.
P.S.  I started this post a few weeks back when VCLK was in the teens.  Wish I would have just hit the "Publish" button, I would have looked smarter. <grin><groan>

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