Don't Wait on BroadVision to Catch Up

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Mar 12, 2012
The vision at BroadVision (BVSN, Financial) has been broad since its inception in 1993. Their expansive scope of operations has encompassed providing parameters for those that use the wonderful worldwide Web. There was the web, and there was BroadVision, like a trusty mentor, overseeing organizations and giving them the guidelines, tips, tools, and tricks of the trade, but mainly, the foundation and framework for conducting business online. Without a solid foundation and framework, everything collapses. Eventually. So, shareholders of this company, existing and potential, have that reputation and long-standing presence to fall back on. Nothing can replace history. BroadVision has many innovations to its name and much to be proud of.


This company’s headquarters are in Redwood City, Calif., U.S., but it has locations all over the globe. Its share is priced at about $45, close to the high of its 52-week range of 8 to $56. Its average volume for three months is 86,145 shares. It is a small cap company with a market capitalization of $202 million, but I am not a fan of labels. Look at its track record… better than a lot of so-called “large caps” can speak of. So don’t write it off immediately; let us investigate further.


The earnings per share is -.74. If you start to compare it with Oracle Corporation (ORCL, Financial) its competitor, Oracle is surely large cap at $149 billion, so it’s a whole different dimension altogether. Oracle has 108,000 employees, a year-on-year quarterly revenue growth of 2.4%, earnings per share of $1.82, price to earnings ratio of 15.70, and expected price/earnings to growth of .98 and that is for five years. BroadVision has 159 employees, its quarterly revenue year-on-year growth is -18.1%, no PEG and no PE. Nota bene, the gross margin for Oracle is 77.87%; that for BroadVision is 65.93%, pretty much in the same vicinity. Operating margin for Oracle is 36.96% and that for BroadVision is -23.81%. Wow. Yes, a clue for sure. This could very well indicate that BroadVision does not have a handle on its selling and administrative expenses. Earnings before interest, taxes, depreciation, and amortization for Oracle is $15.4 billion, and for BroadVision, EBITDA is $-4.24 million. Truly nothing there for the shareholders, thus it doesn’t make any pretense of offering dividend. Because it can’t. (Oracle does give a .9% dividend)


I was trying to give this company a chance based on its awesome track-record in the field of e-commerce, but I now see a return on assets of -4.23% and a return on equity of -6.28%.


Some good news, finally. Its total debt of the most recent quarter is zero so that earns big points with me; its current ratio is way high at 6.87 indicating a possible inefficient use of current assets.


In terms of news, BroadVision announced that Digital London would use BroadVision’s Clearvale TM enterprise social networking solution to facilitate engagement through the whole lifecycle.


This company was started by Dr. Pehong Chen in 1993, and it introduced the first ecommerce and portal products to the Web which was still in its infancy back then. It went public on NASDAQ in 1996. The market was extended to non-technical users when, in 2001-2006, it introduced many DIY agile development features into its core products.


There is no high price target set for this stock. One never knows what can happen. Such confusion with this company, a star-studded track record on the one hand, and a somber financial picture on the other. I would say look at this company for what it will do next. It makes for interesting reading material. I would not put my money into it. There has to be a measure of confidence created before one invests, though there are never any guarantees.


Let us end with some high points about this company. A massive market expansion was seen during the time span 1996-1998, when BroadVision introduced personalization features for e-commerce.


The introduction of microsites can also be credited to BroadVision.


In 2000, BroadVision got a lot of attention for its launch of the high-end document creation and management tool QuickSilver. It acquired Interleaf at this time.


Something huge happened in this company in 2010. For the first time, BroadVision formally launched a cloud-based “network of networks” for the virtual, mobile, social enterprise, BroadVision Clearvale.


The reason for accolades didn’t quite end with Clearvale. In fact, it appears this company has only just begun. Hot on the heels of the network of networks, the Clearvale SecondFloor Speaker Series was launched, followed by Clearvale PaasPort. This was the first program of its kind which permits companies to resell Clearvale enterprise social networking capabilities with their own products and services to their customers. In February 2011, a free version of the Enterprise social network, Clearvale Express, was released.


What comes next? We have begun to expect great things of this company. And doesn’t everything usually match up to what one anticipates? Trust this will go for its share price and other figures as well. Time to take stock, BroadVision. Get your game caught up with your name and fame.