The buys took place at prices ranging from $11.34 to $11.38 per share, on March 07, 2014
rschultheis6 reflecting on a comment Sloop brought up to you the other day and based on Allot and Procera 's operating performance over last 2 years , with Allot currently valued ay a 3.5X plus EV/Sales & Procera 1.5X or lower multiple what logical explanation do you have for not repositioning your current Allot exposure into Procera ?
So, if you are looking for a decent pick in a strong industry, consider Allot Communications .Not only is its industry currently in the top third, but it is seeing solid estimate revisions as of late, suggesting it could be a very interesting choice for investors seeking a name in this great industry segment.
One stock that might be an intriguing choice for investors right now is Allot Communications Ltd. (ALLT). This is because this security in the Computer Networks space is seeing solid earnings estimate revision activity, and is in great company from a Zacks Industry Rank perspective.
This is important because, often times, a rising tide will lift all boats in an industry, as there can be broad trends taking place in a segment that are boosting securities across the board. This is arguably taking place in the Computer Networks space as it currently has a Zacks Industry Rank of 62 out of more than 250 industries, suggesting it is well-positioned from this perspective, especially when compared to other segments out there.
Meanwhile, Allot Communications is actually looking pretty good on its own too. The firm has seen solid earnings estimate revision activity over the past month, suggesting analysts are becoming a bit more bullish on the firm’s prospects in both the short and long term.
In fact, over the past month, current quarter estimates have risen from 1 cent per share to 2 cents per share, while current year estimates have risen from 30 cents per share to 31 cents per share. This has helped ALLT to earn a Zacks Rank #2 (Buy), further underscoring the company’s solid position.
Netanyahu then is scheduled to visit Apple and WhatsApp, the free messaging service recently bought by Facebook that is widely used in Israel and elsewhere. Israel is a high-tech powerhouse, and many tech giants — including Apple, Google and Microsoft — have made investments there, buying companies or conducting research and development.
Netanyahu is scheduled to return to Los Angeles on Wednesday before leaving Thursday, following a morning speech at the Museum of Tolerance.
In addition to a wide variety of malware detection techniques, advanced solutions in the Secure Web Gateway space such as GFI's WebMonitor are adding DPI engines to their products for improved intelligence and control," said James Dirksen, Vice President of OEM and Embedded Products at Procera. "These solutions are critical to SMBs as the numbers and types of mobile devices in the enterprise have risen in recent years. DPI capabilities will become increasingly important differentiators for them as the market continues to mature and BYOD usage expands."
NAVL's industry leading traffic signature database is updated on an ongoing basis, allowing solution providers to keep their products current with today's evolving network landscape including malicious sites, security threats and potential sources of Internet abuse. NAVL is a next-generation Deep Packet Inspection (DPI) software engine that provides real-time, Layer-7 classification of network traffic. Running on all popular processors and operating systems, NAVL allows integrators to remain focused on their core competencies while implementing industry-leading DPI functionality from Procera in their products.
GFI Software™ develops quality IT solutions for small to mid-sized businesses with generally up to 1,000 users. GFI® offers two main technology solutions: GFI MAX™, which enables managed service providers (MSPs) to deliver superior services to their customers; and GFI Cloud™, which empowers companies with their own internal IT teams to manage and maintain their networks via the cloud. Serving an expanding customer base of more than 200,000 companies, GFI's product line also includes collaboration, network security, anti-spam, patch management, faxing, mail archiving and web monitoring. GFI is a channel-focused company with thousands of partners throughout the world. The company has received numerous awards and industry accolades, and is a long-time Microsoft® Gold ISV Partner.
Procera Networks' NAVL Engine Selected by GFI Software for WebMonitor(TM) Solution
NAVL OEM Embedded Software Engine Provides Internet Intelligence for GFI's Web Security Solution, Enabling SMBs to Monitor, Set and Enforce Usage Policies for Improved ROI
FREMONT, CA--(Marketwired - Mar 4, 2014) - Procera Networks, Inc. (NASDAQ: PKT), the global Internet Intelligence company, today announced that its Network Application Visibility Library (NAVL) has been selected by GFI Software™ to enhance GFI WebMonitor™, one of the industry's leading web security solutions for small to mid-size businesses (SMBs). Procera's NAVL software engine provides granular traffic visibility, intelligence and control for GFI's solution so that IT managers are able to enhance Internet security, optimize bandwidth investments and usage, and monitor network activity for abuse and potential threats.
Drawing on Procera's Internet Intelligence, GFI WebMonitor also enables various departments outside of IT access to information they can use to address their unique concerns by providing real-time information, drill down and highly targeted reports to drive improved decision making about Internet usage, activity and investments.
"SMBs receive a rapid return on investment with GFI WebMonitor, immediately noticing improved productivity, less administrative time spent cleaning infected machines, and better use of bandwidth resources," said Sergio Galindo, GM, Infrastructure Business Unit at GFI. "Using Procera's NAVL solution enhances our product capabilities, enabling us to focus on our core competencies and more strategic activities that drive our bottom line so we can address the evolving concerns and demands of our SMB customers."
These are the type of OEM Partner relationships that will move the needle , read this morning Press Release
This has probably been one of the most caustic beat downs I have ever been exposed to. The disconnect between improving fundamental and continued atrophy of valuation has finally come to the point where downside risk should be flushed out. Shorts have been dealt the perfect hand , Thurs tepid guidance subsequent downgrade and est & price target cuts along with geo political risk enables predators that have maligned this currency the opportunity to exit on their terms. If you read into Needham's comments this morning they feel current valuation reflects all negative news in rear view mirror. Once again this Companies Management had no choice but to project tepid guidance unfortunately market is currently valuing this company as if current guidance is a high hurdle. If you have the time and interest review earning release transcripts and you will c Q4 was in a strong quarter based on numerous key metrics. Improving Gross Margin which mgmt. projects moving forward will continue to improve. B2B 1 , 29% Rev Growth, 40% of SP wins were won in Q4 . Management appears to be slow learner in reference to guidance , now once they get with the program market is taking them literally.
PKT – Downgrade to Buy with $14 tgt from Strong Buy and $20, lowering ests significantly for weaker guidance but this should be the bottom on numbers and shares trading at 1.1x EV/E with 15%+ organic revenue growth
Sloop at current valuation it is fair to say anything positive that Procera has accomplished on the operating side of the equation has been discounted and marginalized very aggressively where as any and all warts have a magnifying glass held up to it. JB went out on a limb on Q213 earning release / conference call when he raised 2013 guidance from 25-30% to 30% or better that decision with the benefit of hindsight ended up causing significant pain to his shareholders and created further dysfunction to his companies valuation relative to its peers. Q4 performance discounting the miss to guidance relative to their competitors was not disappointing but represented another quarter of strong Y/Y comparisons. Q4 based on rev , new wins & B2B reflected a Company that is executing at a high level and competing aggressively against strong competitors to aggregate new business wins. Procera is trading and is currently valued as if they had the lost year and Allot grew their business 25%, what is wrong with this picture.
Nov 2012 Q3 Conference call JB stated my #1 priority moving forward is partnership Technology , System Integration and OEM all over the World. Two months later January 2013 Vineyard transaction accomplished that. Between 2d half 2012 hiring on the support side to additional 25 employees & overhead from Vineyard acquisition Procera became a much larger Organization. JB did raise 80 million plus in the early Summer of 2012 to put him in a position to grow Procera. I looked closely at Q4 operating performance and full year 2013 objectively speaking if you compare Procera result against their competitors #'s speak for themselves. No loss of Business momentum as they exited Q4 for the year PKT Added 68 new service provider customers , 40% were added in Q4 27 new service provider customers. Another key metric which reflected very positively Support revenue continued to grow and is an important source of recurring revenue. Support revenue in the fourth quarter was $5.1 million, up 47% from the prior year . B2B 1 I am hard pressed to understand how a Allot that disappointed 6 quarters in a row did not grow at all during 2013 and if you listen to their most recent conference call does not seen to be adding customer anywhere near the pace Procera is. So yes Procera had some legitimate growing pains in the process of scaling up which is very normal. How much do you penalize a companies valuation when operating team executes and grows 25% when 800lb gorilla in space sees their revenue decline Y/Y ? Also remember Allot does not give guidance , so if you don't field a ball u will not make a error
rugger72 there is two parts to this story one is Procera the Company how they have executed and grown over last 4 years and Procera the stock past guidance and current valuation. Since we all know return and performance is a relative I must reflect to Procera's peers Allot and Sandvine . I am both very disturbed & disappointed to see Procera being treated like a red headed step child considering how this small diminutive company has developed over these past several year into a very formidable competitor in a dynamic growth space. Allot currently valued at 555 million EV 440 with street looking for 2014 rev in the 110-120 / avg 115 = 3.82X EV , Sandvine 475 million " after their recent capital raise of 35 million " EV 350 Million street consensus 130 million for 2014 Sales = 2.69X EV , Procera had no choice with guidance this but to go the other way 15% growth brings us to 85 million est , MC 225 / EV 120 = 1.4X... 2013 was a very solid year on the operating side for this Company , they accomplished much to introduce Scale to this Organization so they can compete effectively against two larger competitors and a Universe of other dynamic technology Companies that if you fall asleep at the wheel will eat your lunch. I will start with Vineyard regardless of what anyone said this transaction provides PKT with the leverage they did not have both Allot & Sandvine aggressively utilize the licensing / reseller market to leverage their core competency Sandvine much more aggressively 70% of their rev comes from that model boots on the ground only in NA , Allot 20% until Vineyard became a operating subsidiary PKT was 100% direct Sales
of 2014 revenue to come from new customers and 60% to come from follow-on
orders. Opex for 2014 is expected to be relatively flat with 4Q13.
Target Price Methodology/Risks
Our target price of $15 represents an EV/2015E sales multiple of 2.0x. Risks to our
target price include a highly competitive landscape, an uncertain regulatory
environment, and volatile sales.
Procera Networks was founded in 2002 as a vendor of intelligent policy
enforcement (IPE) solutions. The company’s flagship solution is its PacketLogic
line, which gathers information on subscribers and applications for analysis,
reporting, and policy enforcement. Its network operator customers include mobile
service providers, broadband service providers, cable operators, Internet service
providers, and private networks inside enterprises. Procera sells its products
through its direct sales force, resellers, distributors, and system integrators in the
Americas, Asia Pacific, and Europe. Procera is headquartered in Fremont,
California, and has offices in Sweden and Singapore.
By Geography: EMEA was 47% of total revenue or $10.0m, up 4.4% q/q.
Americas revenue was 35% of the total or $7.5m, up 12.9% q/q – lower than
expected due to the weakness in the US cable operator space that is likely the
result of cable industry consolidation causing cable operators to pause on
spending. APAC had 18% of sales with $3.8m, down 28% q/q. Overall,
international growth has been strong, with the additional hiring in international
sales staff spurring growth. In 2014, international growth is expected to be strong
Balance Sheet: The company finished the quarter with net cash and equivalents
of $106.6m, a $2.3m decrease from last quarter’s $108.9m. Deferred revenue
increased $2.0m to $14.9m q/q from delivering maintenance and support and term
licenses from the Vineyard acquisition. Inventory increased $1.8m to $18.8m due
to the lower revenues. We expect inventories to decline in 1Q14. Receivables
increased $4.7m to $25.0m and DSOs increased by 20 days to 106 due to longer
than typical payment terms for one large tier-1 customer (that is expected to pay
Guidance: For 1Q, Procera guided revenue to be flat to a slight increase from
1Q13 (which implies a 34% sequential decline if 1Q growth is flat y/y). Gross
margin is expected to rise to the low to mid-60% range on increases in higher
gross margin support revenue, increases in Vineyard revenue, and a mix shift
toward more software orders. Opex is expected to be relatively flat with 4Q13.
For 2014, Procera guided for 15% revenue growth, which, given 1Q guidance of
around flat y/y, implies large sequential quarterly growth in 2Q-4Q. The company
plans to continue investing in its product solutions, while offsetting the cost of
these investments with cost reductions in other parts of the business. A return to
profitability is expected for 2H13. Also, management expects approximately 40%
Results: Total revenue was $21.3m, up 28.7% y/y and flat q/q – in line with
Procera’s pre-announcement. Product revenue increased 23.8% y/y to $16.2m.
Service revenue grew 47.4% y/y to $5.1m. Bookings were down 1% q/q to
$22.4m, compared to $22.6m last quarter. Still, book-to-bill was above 1.0x. Gross
margin was 59.7%, up 9.4% from the previous quarter due to the normalization of
product mix from 3Q, which included a large mega-carrier deal (we believe with
British Telecom) with a high amount of initial low-margin hardware deployment.
Operating expenses increased 50.1% y/y to $12.7m as a result of investments in
R&D, quality control, global sales team, and the Vineyard acquisition. EPS was
Customers and Trials: Procera reported 27 new service provider customers, up
from 18 last quarter. Three were tier-1 wins. New customers made up 32% of
revenues compared to 71% last quarter. Tier-1 trials numbered 16 (same as last
quarter). Customer mix was fixed at 34% of revenues, mobile at 32%, cable at
20% of revenues, and 14% higher education/enterprises of revenues. New wins
include two new Latin American tier-1 fixed line operators, including one cable
MSO and one DSL operator. Also, the company received a first-time multi-million
dollar order from a tier-1 operator in EMEA. For 2013, the company has added 68
new service provider customers and revenue mix was 33% mobile, 29% fixed,
26% cable, and 12% higher education/enterprise, with 45% of revenue from new
customers and 55% from follow-on.
Vineyard Networks Acquisition: The former Vineyard Networks contributed
$0.925m in the quarter (up 19% q/q) with six new embedded wins.
Conservative Guidance for 1Q Implies Very Aggressive Out Quarters Growth
Procera pre-announced lower than expected 1Q revenues on January 7, and
actual 1Q results came in line with the pre-announcement. Revenues for the
quarter were $21.3m, which were well short of original consensus expectations of
$25m. Revenue was low due to weakness in the US cable operator space.
Management cited cable industry consolidation leading to a pause on spending in
Guidance for 2015 was for 15% growth, but 1Q was expected to be around flat y/y,
which implies a 34% q/q decline from 4Q13. As a result, 2Q through 4Q will require
very aggressive sequential growth rates to achieve management's 2014 15%
growth target. However, management indicated the company has backlog and the
sales pipeline to support its 15% forecast.
Investments in growing international sales have resulted in a strong uptick in
EMEA and Latin American sales, with EMEA growing 74% y/y and APAC rising
16% y/y. The company received a first-time multi-million dollar order from a tier-1
operator in EMEA during the period and won two new fixed line Latin American
Our take: The recent changes of Net Neutrality laws by the courts in the US are
likely to bolster the use of DPI products by service providers as they look for new
revenue generating opportunities and partnerships. Although the US cable market
could be a drag on growth in 2014, the company clearly seems to be gaining
traction internationally, where it has built out its international sales footprint,
especially in markets where it had poor representation before – Europe and Latin
America. While we are concerned about the implied sequential growth
requirements to get to the company's goal of 15% growth in 2014, Procera's
valuation still looks compelling at 1.4x EV/2015E sales, compared to its closest
competitor Allot. The company also has around $5.29 in cash/share. We maintain
our Buy rating.
PK this was Wedge's response to your last post I don't believe it had traction so allow me to share it with you ...........................
wedgecake • 16 minutes ago
PK, you got to buy when blood running in da street..that was a buyout at 4 times; it will get to 2x easy from 1.4 and besides the midpoint between PKT at 11.35 and Allot at 17 is 14.17..it will do 14 or 15 again after this week..all sold out PK..