ValueClick Could Represent a Huge Value for Investors

by Sam Collins | December 4, 2013 1:22 am

ValueClick (VCLK[1]) — This independent, small-cap provider of online and mobile advertising services began to buy back $225 million of its shares in the first half of 2013. S&P expects net margins to improve through 2015 relating to the benefits of acquisitions made in 2011, a divestiture in 2012, and discontinued operations this year. Though speculative, it views ValueClick as a potential acquisition candidate.

Consensus estimate are for earnings of $1.49 per share in 2013 and $1.85 in 2014. VCLK is trading at just 11.4 times next year’s earnings.

Following a decline from over $32 in May to under $19 in early November, VCLK reversed on several big-volume days. The dramatic reversal formed a double-bottom and a variation of an inverse head-and-shoulders formation with a neckline at $22.

A break through $22 should provide a quick trade to $26, but the stock could be making a major long-term bottom with significant upside potential. Thus, long-term investors should also consider purchasing it.

VCLK Chart
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