Key Takeaways from Q3-13 of Local Corp with an idlotic low market-cap off 39 million yesterday
• Revised 2013 guidance:
» Annual revenue for 2013 is expected to be at the low end of previously provided guidance of $95 to $97 million
» Adjusted EBITDA is expected to be approximately $4.5 million
• Sequential revenue growth up 4% to $23.5 million in Q3-13 from $22.7 million in Q2-13
• Adjusted EBITDA up 12% to $1.3 million in Q3-13 from $1.2 million in Q2-13
• Continued expansion of our highest gross margin business –Network revenue up 190% from Q3-12
• Significant progress related to local shopping
» Launched next generation Krillion®local shopping platform
» Announced agreement to provide location-based product data for major search engine
» Powering shopping channel for Pittsburgh Post-Gazette
“Because we have access to what’s in that store, plus what’s in 70,000 retail locations nationwide,” Clarke said, “we can tell you if that Pioneer 50-inch plasma is cheaper up the road at Sears than it is at the Best Buy you are standing in and tell you if it’s in stock right now.”
But when you have a CEO obsessed with "growing the brand", and the only way to do that is to have hundreds of Inside Sales associates cold calling Realtor's in a desperate attempt to get then to sign up for Zip Codes as Premier Agents then the Sales & Marketing costs keep going up faster than the incremental revenues. Zillows other problem is with Unique Users slumping 8.3% in September and dropping a further 2% in October it will be difficult for them to grow Advertising revenues. Whoever gets appointed to the FP&A role is on a hiding to nothing in that environment.
Seems that the Zillow malaise has spread from Seattle to the new office in Irvine, CA with one ex employee suggesting under the Pros heading "have an exit strategy before you start" , and for Cons "all you can think of".
I cannot find anything to justify the premium Zillow enjoys over Trulia. Z could be the best short in the market today.
Z shares should be the same price as TRLA or less, and look what they are doing to TRLA shares! Ooooooooooooooooph!!!
Very similar revenues. TRLA earnings est. $.75. Z earnings est. $.50
Z has more than twice the mkt value of TRLA and TRLA chart is broken. Z is in trouble.
Berkshire Hathaway (Article in yesterday's Des Moines Register) has a subsidiary that is going to directly compete with Z and TRLA, and Apartment List on the rental side of things.
The guy from RBC said to avoid Z no matter how much it's been beaten down. Something about having run up too far too fast.
Thanks for looking into your Dollar Store bought crystal ball. Now I wont get screwed over by buying to high. Wow that was EASY.
Sentiment: Strong Buy
Just another short sucker scenario. Would love to build on the dips. Its only 4months till Spring and by then it will be to late to get in. Thanks for the shares.
Sentiment: Strong Buy