Indices are green after Dow dipping into red earlier.
S&P 500 @ 1765.62, high 1767.67
Internals are positive
Oil UP 37 cents
Gold UP $1.90
Canadian $ Down 1 tick @ 95.58
VIX Down 1.58% @ 13.07
Portfolio AMZN FNSR JKS LNKD MU
Most stocks are UP
@ 1.59 following are red :
AMZN KORS FB BIDU SINA GOOG EBAY
LVS MA V YNDX LRCX BRCM SBUX
MCD WYNN RALY.....
BLOG does NOT give buy or sell.
Saleem
7 comments:
Hey Saleem,
Preliminarily, CSOD didn't meet my lofty expectations of $49-50M in revenue this quarter, but it looks like a bit of a relief rally in after hours based on not being as bad as the recent price action indicated. There's still guidance to come in the conference call. I'll be interested to see how the trends are looking based on this "inline" quarter.
Stocktrader
Hi Stocktrader,
Based on yahoo financial..EPS was a miss by 1 cents as expectations was loss of 3 cents..came in @ 4 cents loss......BUT it is green by 2.95%....expectations are of breakeven Q for guidance & $54.53 million in Sales.....
Good luck with cc
Saleem
Hey Saleem,
The EPS doesn't matter too much here as they are still in rapid growth phase and intentionally plowing all gross profits back into the business. The gross margin number looked fine.
Guidance should be interesting. There's a decent size step-up anticipated for Q4 and they traditionally guide conservatively.
Stocktrader
Hey Saleem,
Guidance for Q4: 54.2M - 55.7M
That sounds good given their somewhat conservative nature also.
Stocktrader
Hi Stocktrader,
Sales guidance is above expectations & stock is is UP 6.26% now.....your conviction is paying off$$$$
Saleem
Hey Saleem,
In listening to the CSOD conference call, there's nothing changed with the growth story.
They are currently seeing 30% of revenues from international clients (almost exclusively Europe) and look to expand that to 50% over time with increased presence and penetration throughout the world.
They see potential for 3x the revenue from each client than they are currently getting based on selling them additional products, but also see the potential for new clients of 350M seats (versus 13M now).
ASPs rose 30% year over year thanks to less discounting as they are one of the few to offer a comprehensive suite of talent management products and also a shift to more SMB clients where ASPs are much higher (in some cases 2-4x).
Their newest cloud, Recruiting, doubled in penetration with their clients QoQ.
They see US government business as depressed and staying that way. This is creating a lot of pent up demand, but with sequester spending levels, they don't expect it to "unleash" any time soon.
The second phase of their Connect product will come out in January and they expect many of their clients will convert in Q1 and Q2.
They continue to see a favorable competitive environment, and with recent and expected departures of the SFSF talent from SAP, they expect to hold an even more dominant position going forward given the talent from the Taleo acquisition by ORCL has already left. Additionally, they believe their specialization on talent management keeps them distinct from other core HR companies, and allows for easy cooperation instead of competition.
Their main areas of growth for 2014 include international markets, SMB markets, and upsells to current clients.
They admit they were late to the mobile game, but see this as a positive now as most companies changed their mobile strategy 12-18 months ago anyways to go native mobile from mobile web. CSOD started with native mobile and have already rolled out key supporting applications, and have a dedicated team that will execute an aggressive roadmap over the next 12 months.
Their Cornerstone for Salesforce is seeing great success and they see further opportunity for that product in both new and existing clients.
Those are about all of the main points. Based on their current picture, I see 2014 revenue goals as achievable, and still think they are positioned so perfectly in this talent management niche, both from a competitive aspect as acquisitive competitors wither, but also as their suite becomes ever-more comprehensive. They are widening the lead, and this creates pricing power and enhanced opportunity. There is still the possibility they could be acquired.
Stocktrader
Hi Stocktrader,
Thanks for your detailed summary.....it gives lot of insight into CSOD about their plans & strategy.
I will monitor CSOD closely...
Saleem
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