On Mar 11, 2014, we issued an updated research report on j2 Global Inc. (JCOM). Record revenue growth and lower churn rate coupled with the company’s decision to diversify into cloud business has encouraged the management to raise its outlook for fiscal 2014.
j2 Global has delivered positive earnings surprise in all four quarters last year, with an average beat of 9.48%. The company reported mixed financial results for the fourth quarter of fiscal 2013 with the bottom line beating the Zacks Consensus Estimate but the top line missing the same.
At present, j2 Global commands approximately 30% of the world’s cloud-based digital faxing system. The company has successfully boosted sales from credit-sensitive clients, despite global macroeconomic volatility.
Recently, the company acquired two Australian Internet fax business service providers. The buyouts include Sydney-based OzeFax and Brisbane-based Faxmate. These acquisitions will strengthen j2 Global’s fax business in Australia. j2 Global achieved record revenue growth in fiscal 2013 and also raised its outlook for fiscal 2014.
j2 Global expects to capitalize on increasing demand for cloud based, value-added communication, messaging and data backup services. Segment wise, j2 Global continues to improve its most powerful eFax brand with creative content and designs. Strong free cash flow and low leverage have induced the company to execute five buyouts in 2013.
j2 Global currently carries a Zacks Rank #1 (Strong Buy).
Stocks That Warrant a Look
Other well-performing stocks in the Internet/Application software industry include China Mobile Games and Entertainment Group Limited (CMGE), Model N Inc. (MODN) and Open Text Corporation (OTEX). All three stocks currently have the same Zacks Rank as j2 Global.