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Actuate Corporation Message Board

  • bimmertx bimmertx Feb 4, 2011 1:13 PM Flag

    Management's next move?

    Not good if this goes under $5 a share and stays there. Will the boys announce another stock buy back program next week? I don't know, but it is getting interesting. Are we headed to the low $4's again?

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    • Good question.
      Incurring significant debt a few years ago allowed Actuate to do the dutch auction. This gave some major holders the chance to get out without crashing the stock price, and it also reduced Actuate's share count to the point the company's EPS would remain positive.
      Also, last years Xenos acquisition bought Actuate enough revenues so that the past 12 months could show a small total increase in Actuate total revenues.
      But now, with the debt on its books, Actuate doesn't have the cash reserves to allow Cittadini to buy another company's revenues so that Actuate can show some topline growth. I am sure there are more Canadian company's who would welcome Actuate buying them for 2X revenues, like Cittadini did for Performancesoft and Xenos, but Actuate no longer has the cash to play that game.
      This means that for Actuate to have any growth, the company must do it from within its own business operations. I've been monitoring Actuate for about 10 years and have yet to see the company produce any significant internal, organic growth. In that time I've heard management's expectations about pursuing new vertical markets outside the financial sector, assorted refresh cycles, internet, intranet, and extranet dynamics, and most recently the strategy of offering free downloads to attract a mass of developers/programmers. While none of the above initiatives was producing significant organic growth, Actuate management bought itself time with games like the dutch auction and acquiring a couple of Canadain company's annual revenues.
      This is where we are today.
      Going forward, considering Actuate's debt load and limited positive cash reserves, my expectation is that Actuate management's "next move" is to just hope that some corporate and, or government enterprises are willing to pay Actuate for deployment servers and maintenance contracts.Since this strategy has not materialized much in recent years I do not have optimism for any change of course.

      • 1 Reply to the_factman
      • Totally agree. I've been following them for ten yeas as well and they can't buy growth or develop it. The dutch auction was a screwing of the shareholders. I think they are stuck.

        It was funny how we heard from Cittadini that BIRT would lower the cost of sales and it would be an ubelievable revenue generator. Now they are up to 46 sales reps.

        The CFO will probably be dumping again next week.

    • Hey BIMM....If we were heading to low $4's , I would think UBS with their 100,000 share purchase & ROTH would of held off their buying....TRUE ??

      • 1 Reply to richardtherings
      • Richard, I honestly don't know what will happen with the stock. They took some heat on the conference call and got defensive. Why these companies bought today, I don't know. 100,000 shares isn't much. While they were buying some one else was selling. The trend is down and for how long, who knows.

        When the other BI players are having record quarters and you are flat, it isn't good. I would like to see a continued pull back and then it could get interesting. An activist could get involved if it goes significantly lower, but again speculation.