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Carl Icahn Sets His Sights on Analytics Company Cloudera

Billionaire investor Carl Icahn (Trades, Portfolio), leader of New York-based Icahn Capital Management, disclosed a 12.6% stake in data analytics company Cloudera Inc. (NYSE:CLDR) on Thursday.

According to GuruFocus Real-Time Picks, a Premium feature, Icahn invested in 17.6 million shares of the Palo Alto, California-based software company on July 22, allocating 0.43% of the equity portfolio to the holding. The stock traded for an average price of $5.85 per share.

Reuters reported the renowned guru, who is known for taking activist positions in undervalued, struggling companies and working with management to unlock value for shareholders, said he may also seek seats on Cloudera's board.

The software company, which provides a cloud-based platform for data engineering, data warehousing, machine learning and analytics, has a $1.79 billion market cap; its shares were trading around $6.55 on Friday with a price-book ratio of 1.16 and a price-sales ratio of 2.14.

GuruFocus estimates the stock has tumbled 40% year to date.

Cloudera recorded first-quarter results on June 5, posting a net loss of 38 cents per share on $187.5 million in revenue. Subscription revenue was $154.8 million. It is slated to report second-quarter earnings on Sept. 4.

The software company also announced CEO Tom Reilly's retirement, naming Chairman Martin Coal as interim CEO.

Driven by no long-term debt and comfortable interest coverage, GuruFocus rated Cloudera's financial strength 8 out of 10. The low Altman Z-Score of 0.46, however, warns the company could be at risk of going bankrupt. The Beneish M-Score of -0.65 also indicates possible earnings manipulation.

The company's profitability and growth did not fare as well, scoring a 3 out of 10 rating on the back of negative margins and returns that underperform a majority of competitors. Cloudera is supported, however, by a moderate Piotroski F-Score of 6, which implies business conditions are stable.

Icahn is now the company's largest guru shareholder. Jim Simons (Trades, Portfolio)' Renaissance Technologies, Mariko Gordon (Trades, Portfolio), Steven Cohen (Trades, Portfolio), Chase Coleman (Trades, Portfolio) and Paul Tudor Jones (Trades, Portfolio) also have positions in the stock.

Portfolio composition

Icahn's $24.10 billion equity portfolio, which consisted of 16 positions as of the end of the first quarter, is heavily invested in the industrials sector with a weight of 59.32%.


Other technology stocks, which make up a mere 3.11% of the equity portfolio, the guru was invested in as of first-quarter-end were Xerox Corp. (NYSE:XRX) and Dell Technologies Inc. (NYSE:DELL).

Disclosure: No positions.

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This article first appeared on GuruFocus.