Edenbrook Capital, LLC Boosts Stake in Brightcove Inc
Edenbrook Capital, LLC (Trades, Portfolio), a renowned investment firm, has recently increased its holdings in Brightcove Inc. The transaction, which took place on October 12, 2023, saw the firm add 7,500 shares to its portfolio at a trade price of $2.9 per share. This acquisition brings Edenbrook Capital's total holdings in Brightcove Inc to 6,308,246 shares, representing 14.59% of the company's outstanding shares and 3.41% of the firm's portfolio.
About Edenbrook Capital, LLC (Trades, Portfolio)
Edenbrook Capital, LLC (Trades, Portfolio) is a distinguished investment firm based in Mt. Kisco, New York. The firm manages a portfolio of 12 stocks, with a total equity of $537 million. Its top holdings include Haynes International Inc(NASDAQ:HAYN), Marchex Inc(NASDAQ:MCHX), Magnite Inc(NASDAQ:MGNI), Absolute Software Corp(NASDAQ:ABST), and Cognyte Software Ltd(NASDAQ:CGNT). The firm's investments are primarily concentrated in the Technology and Communication Services sectors.
Overview of Brightcove Inc
Brightcove Inc, a US-based company, is a leading provider of cloud-based services for the video ecosystem. The company, which went public on February 17, 2012, offers solutions primarily to media companies, broadcasters, publishers, and corporations. Brightcove's flagship product, Video Cloud, enables customers to publish and distribute video to Internet-connected devices. The company operates in two segments: Premium and Volume, and has a market capitalization of $131.699 million.
Analysis of Brightcove Inc's Stock Performance
As of October 17, 2023, Brightcove Inc's stock is trading at $3.045 per share. The company's PE percentage is currently not applicable, indicating that the company is operating at a loss. According to GuruFocus's valuation, the stock is potentially a value trap, with a GF Value of 8.13 and a Price to GF Value ratio of 0.37. Since the transaction, the stock has gained 5%, but it has lost 79% of its value since its IPO and is down 41.67% year-to-date. Brightcove Inc's GF Score is 57/100, suggesting poor future performance potential.
Evaluation of Brightcove Inc's Financial Health
Brightcove Inc's financial health is a mixed bag. The company's balance sheet rank is 5/10, while its profitability rank and growth rank are both 3/10. Its GF Value Rank is 4/10, and its momentum rank is 2/10. The company's Piotroski F-Score is 3, and its Altman Z score is -0.48, indicating potential financial distress. Brightcove Inc's cash to debt ratio is 0.81, ranking it 1866th in the industry.
Examination of Brightcove Inc's Industry Performance
In the Software industry, Brightcove Inc's performance has been lackluster. The company's ROE and ROA are -25.32 and -11.05 respectively, ranking it 2047th and 2017th in the industry. Its gross margin growth is 2.10, while its operating margin growth is 0.00. Over the past three years, the company's revenue growth has been 1.30, while its EBITDA growth has been 0.00. However, its earnings growth over the same period has been a robust 27.60.
Assessment of Brightcove Inc's Stock Predictability and Momentum
Brightcove Inc's stock predictability rank is currently not available. The stock's RSI 5 Day, RSI 9 Day, and RSI 14 Day are 11.35, 17.14, and 22.88 respectively. Its momentum index for 6 - 1 month is -15.01, and for 12 - 1 month is -43.82. The stock's RSI 14 Day rank is 123, and its momentum index for 6 - 1 month ranks 1791st.
Conclusion
In conclusion, Edenbrook Capital, LLC (Trades, Portfolio)'s recent acquisition of Brightcove Inc shares represents a significant addition to its portfolio. Despite the company's mixed financial health and lackluster industry performance, the firm's increased stake could potentially yield significant returns in the long run. However, given the stock's poor GF Score and potential value trap status, value investors should exercise caution and conduct thorough due diligence before considering an investment in Brightcove Inc.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
This article first appeared on GuruFocus.
