Tidbits from the recent GaveKal NYC briefing

Prepar­ing for Face­book Post-IPO - Face­book pre­pares for liftoff this week. This note focuses on more on the larger for­ward exe­cu­tion mea­sures. Shares should set­tle in between $50 and $60 – our IV fig­ures for 2012 and 2013. Pub­lished May16, 2012.

The return of log file analy­sis with Splunk ($) - Enter­prises are turn­ing to log file analy­sis to get more “orga­ni­za­tional intel­li­gence” in areas like appli­ca­tion man­age­ment, infor­ma­tion secu­rity and even e-commerce. We look at Splunk which is going pub­lic to exploit this oppor­tu­nity. Pub­lished April 16, 2012.

This Nan­otech­nol­ogy Show­case Review note pro­vides a sum­mary of the ten com­pa­nies that par­tic­i­pated in the recent H&H 2012 nan­otech­nol­ogy show­case event in NYC on March 13th. Many of these com­pany pre­sen­ta­tions pro­vide a win­dow on the increas­ing breadth and depth of nan­otech­nol­ogy into the invest­ment land­scape. Pub­lished April 4, 2012

Scaleable Solar with Enphase (ENPH) and Bright­Source (BRSE) IPO Note ($) - Solar has been a dif­fi­cult invest­ment space but two new pub­lic com­pa­nies are more inter­est­ing from a growth equity per­spec­tive. Enphase turns solar pan­els from DC to AC with “micro invert­ers” and Bright­Source turns solar energy into con­ven­tional steam power for util­ity elec­tric­ity gen­er­a­tion. If you are inter­ested in alter­na­tive energy and solar invest­ing these are both worth a closer look. Pub­lished March 30, 2012.

Infor­ma­tion Secu­rity Update 1Q2012 ($) - Infor­ma­tion secu­rity and pri­vacy is going to be a big issue and strong spend­ing area for years to come. We’re at the begin­ning of a major upgrade and replace­ment cycle along with increas­ing aware­ness that con­sumers are at risk. This quar­terly update looks at a few areas and fea­tures and expanded ecosys­tem of tracked com­pa­nies. Pub­lished March 30, 2012.

Strike­Force Tech­nolo­gies Inc. (SFOR) - Strike­Force pro­vides strong enter­prise infor­ma­tion secu­rity soft­ware that includes patented out-of-band tech­nol­ogy and key­stroke encryp­tion. Their micro-cap sta­tus stands in stark con­trast to their prod­uct poten­tial and recent large cus­tomer wins. Our Strike­Force research report can be accessed with­out reg­is­tra­tion. Pub­lished Feb­ru­ary 22, 2012.

Proto Labs (PRLB) IPO Note ($) - Proto Labs takes 3D designs in soft­ware and man­u­fac­tures short-runs of real parts using either injec­tion mold­ing or CNC machin­ing. The com­pany has a proven repeat­able and grow­ing sales model, high mar­gins and good man­age­ment. Our IV is $32. Pub­lished Feb­ru­ary 21, 2012.

Ceres (CERE) IPO Note ($) - Ceres is a devel­op­ment stage com­pany in the bio­engi­neer­ing space. The com­pany cre­ates genet­i­cally mod­i­fied and enhanced crops aimed at the energy feed­stock mar­ket. The results, eco­nom­ics and early adop­tion all look encour­ag­ing, par­tic­u­larly in Brazil. They com­pany plans to scale rapidly and drive a very high mar­gin busi­ness model. If they can do it an intrin­sic value of $65/share will be achiev­able.  Pub­lished Feb­ru­ary 13, 2012.

Bright­cove (BCOV) IPO Full Report ($) - Bright­cove  pro­vides a video con­tent plat­form that pub­lish­ers use to orga­nize, mon­e­tize and mon­i­tor their online video con­tent. It’s a high qual­ity com­pany that has taken the “high road” to prod­uct and mar­ket devel­op­ment. Growth has been a lit­tle slower than we orig­i­nally fore­cast and mar­gins need to expand con­sid­er­ably to sup­port our $13 IV. Pub­lished Feb­ru­ary 8, 2012.

Poly­com (PLCM) Com­pany Note ($) - Poly­com has expanded their prod­uct line, dis­tri­b­u­tion net­work and improved their exe­cu­tion in the last two years. The major growth dri­vers are now uni­fied com­mu­ni­ca­tions and telep­res­ence solu­tions. Oper­a­tionally the com­pany is back on track and poised for a solid 2012. Our IV sug­gests a $23 share value. More strate­gi­cally it’s not yet evi­dent that Poly­com is prepar­ing to exploit the broader oppor­tu­ni­ties avail­able in enter­prise col­lab­o­ra­tion. If they do there is a multi-fold increase in their poten­tial mar­ket and upside to our IV. Published Feb­ru­ary 7, 2012.

AVG (AVG) IPO Note ($) - AVG has lever­aged their posi­tion as “the free anti-virus soft­ware com­pany” to build a large user base and intro-duce pre­mium ver­sions, new prod­ucts and inno­v­a­tive online rev­enue shar­ing to drive mar­ket share, rev­enue and prof­its. In the past few years the com­pany has grown organ­i­cally, via prod­uct line expan­sion and through acqui­si­tions. There are cer­tainly things to like in terms of their growth, prof­itabil­ity, cus­tomer acqui­si­tion model and mar­ket oppor­tu­nity. How­ever a large num­ber of acqui­si­tions in the last 12 months, a fairly new man­age­ment team and tax-avoiding orga­ni­za­tion make find­ing the right mul­ti­ple a lit­tle tricky. We used a 17.5x mul­ti­ple to arrive at a $36 IV. Pub­lished Jan­u­ary 31, 2012.