2. LivePerson, Inc. (NASDAQ:LPSN)
Number of Hedge Fund Investors: 11
On May 8, LivePerson, Inc.’s first-quarter results saw a 20.9% drop in total revenue to $85.1 million from $107.66 million in the same period the previous year, mostly due to the loss of clients and the closure of non-core business lines, as claimed by the company. The revenue growth rate has also decreased -21.91% year over year to $401.98 million in 2023. The stock closed at $0.70 per share on June 6, 2024. Although in the past month, the stock percentage return has surged up 19%, it has decreased more than 80% over the past year.
Artisan Small Cap Fund, in its Q4 2021 investor letter, mentioned LivePerson, Inc. (NASDAQ: LPSN) and discussed its stance on the firm.
Here is what Artisan Small Cap Fund has to say about LivePerson, Inc. in its Q4 2021 investor letter:
“LivePerson is a leading provider of mobile and online messaging solutions. We believe customer service and sales centers are shifting from voice to digital communications, and LivePerson is well equipped to lead this shift. Its LiveEngage cloud-based platform allows brands to engage with customers across digital channels at scale, more efficiently and more effectively. The market opportunity is substantial and goes well beyond digital conversations in service contexts and into areas such as sales, marketing and possibly social media monitoring. A key part of our thesis when we began our investment campaign in 2018 was the arrival of Alex Spinelli as the company’s CTO. Mr. Spinelli came from Amazon, where he was one of the architects and leaders of Alexa. In addition, Mr. Spinelli brought several well-respected technologists to LivePerson with him. Unfortunately, Mr. Spinelli announced his departure from LivePerson in Q3. In addition to this development, our profit cycle thesis has been stalled as the company makes a round of investments into its sales force which will weigh on margins over the near term. We believe Mr. Spinelli’s replacement, Andrew Hamel, carries the credentials to continue leading LivePerson’s technology efforts. Mr. Spinelli worked for Mr. Hamel at Amazon, and the investments in the sales force have the potential to allow the company to scale its business more rapidly. Still, we are in a holding pattern until we gain conviction that the profit cycle we originally invested in can continue to flourish with these changes.”
Of the 920 funds in Insider Monkey’s database, 11 hedge funds had stakes in LivePerson, Inc. (NASDAQ: LPSN). Cynthia Paul’s Lynrock Lake is the largest stakeholder in the company, with 145.96 million shares worth $60.21 million.
Revenue growth dropped in this quarter and prior year, with a declining EPS suggesting that the company is currently unprofitable. Investing in such a stock involves higher risk, but the company may still have room to develop given the unexpected surge over the past month. A forward P/E ratio of 19.30 reveals that investors are willing to pay for the company’s estimated future earnings because they believe the company is underearning now and will probably rise back up. Overall, its average volume is 3.61M with 11 hedge funds invested in this stock which makes it one of the Most Popular AI Penny Stocks Under $1.
