March 7 addendum - CEO JR Smith resigns - AVG Technologies N.V. (AVG) said J.R. Smith will step down as chief executive after a six-year tenure at the helm of the Internet and mobile-security provider, which is conducting a search for his successor. http://online.wsj.com/article/BT-CO-20130307-715759.html He is remaining on the board.
- Overall revenue up 31% to $356 million - Good. Subscription based revenue was up 12% while
platform based revenue was up 65%. Platform
based revenue now comprises 45% of AVG’s revenue (Can you say Google?).
- In a Seeking Alpha article - “AVG: Feb 1st Google Policy Updates Threaten AVG's Growth Engine, Signals Steep Downside”. Google would require companies to make use of “opt-out” instead of having “opt-in” checked automatically on the customer’s behalf. The author of the article, Eiad Asbahi, is forecasting reduced revenue for AVG because of this. http://kensek.blogspot.com/2013/02/avg-technologies-ipo-one-year-birthday.html
- Net income dropped 44% to $46 million in 2012 from 2011. This usually isn’t a good thing, especially when revenue is up 31%. Not a sustainable model.
- Gross profit margin dropped 3% from 89% to 86%. Most industries would be envious, even with the decline.
- From Motley Fool. Short shares as a percent of float 18.6%. For Symantec, the figure is 1.6%.
- From Motley Fool. Short shares increase between January 31 and February 15, 278.5%. Ouch for both of the figures from Motley Fool. One would like investors to have confidence that the stock will go up. http://www.fool.com/investing/general/2013/03/04/shorts-are-piling-into-these-stocks-should-you-22.aspx
- Current ratio Symantec – 1.06. Current ratio – AVG Technologies - .54.
- Happiness is positive cash flow -AVG has been generating cash.