J. Carlo Cannell’s Cannell Capital is among a group of concerned Procera Networks Inc (NASDAQ:PKT) shareholders which has nominated four directors for the board of that company, according to a filing with the SEC yesterday. The group, which also includes Tristan Partners, owns approximately 1.5% of Procera’s shares. In the case of Cannell Capital, it owned 311,900 shares as of the end of 2014, a position which it opened during the last quarter.
The San Francisco-based Cannell Capital was founded by Cannell in 1992 with just $600,000, and had a portfolio valued at $302 million at the end of 2014. Cannell prefers to keep his fund small, and his investments focused on small-cap, undervalued companies. He famously returned a 15% chunk of capital to his investors in 2004 when he felt his fund was on the verge of becoming too big and losing its focus. Cannell has often sought out unknown commodities, specifically seeking out companies with limited analyst coverage.
The nominees put forth by the Concerned Procera Stockholders are Paul W. Shaneck, Dilip Singh, Mark D. Stolper and Howard E. Mark. With over 100 years of combined experience in the telecommunications, technology, and computer industries fields, the nominees would bring a wealth of experience to Procera Networks Inc (NASDAQ:PKT)’s board.
Procera Networks Inc (NASDAQ:PKT) has been an investment disappointment since its IPO at the beginning of 2013, shedding 50% of its value since, and dipping under $6 at one point in October, 2014. Since then it has gained 50%, and is up 26.01% year-to-date. The networking equipment and services provider recently formed a partnership with Dell through its Procera Alliances Program. Through the partnership, Procera’s PacketLogic internet intelligence solution with be available on some Intel server platforms as a preconfigured and fully validated solution.
Other Procera Networks Inc (NASDAQ:PKT) shareholders include Clint Carlson’s Carlson Capital, with 731,208 shares, and Peter A. Wright’s P.A.W Capital Partners, with an even 300,000 shares.
Cannell Capital also recently filed its latest 13F with the SEC, and we’ll take a look at its top three positions from that filing now, beginning with GTT Communications Inc (NYSE:GTT). This has been Cannell’s top pick dating back to the second half of 2013, and has gained 184.73% since the fourth quarter of 2013. Cannell trimmed the position slightly in the fourth quarter, to 2.55 million shares, down 7% from the end of the third quarter.
GTT Communications Inc (NYSE:GTT), a cloud services company based in Virginia, was down in 2015 until it announced the purchase of MegaPath’s Managed Services business on February 20, for $152.3 million in cash and stock. Shares are up 22.29% in the week since that move, as it accelerates GTT’s ambition to achieve $400 million in revenue. The portfolio of managed services generated $124 million in revenue for MegaPath last year.
Cannell’s second most valuable position was in Intralinks Holdings Inc (NYSE:IL) with 1.85 million shares valued at $22.01 million. Cannell has held a position in the software-as-a-service provider since the first quarter of 2012. That followed a disastrous 2011 for the stock, which shed over 60% from the beginning of that year, and over 80% from its all-time high of $31.76 near the end of April of that year.
While shares are up over 50% since then, Intralinks Holdings Inc (NYSE:IL) is coming off a down year, dipping 10%, and is suffering even worse in 2015, down over 15%. All of that dip and more occurred today, when the company released its fourth quarter earnings results. While revenue came in slightly above expectations, earnings did not. More importantly, guidance for 2015 was underwhelming, with revenue growth projected between 4% and 6%, and earnings projected to be flat year-over-year, which led to the huge selloff of shares.
Lastly is EVINE Live Inc (NASDAQ:EVLV), formerly known as ValueVision Media, and later ShopNBC. Cannell has been a long-time shareholder of EVINE as well, dating back to the second quarter of 2011. Cannell is one of the largest shareholders of EVINE, with ownership of 3.09 million shares at the end of 2014. After dipping below $2 in 2012, EVINE rebounded with a strong 2013, gaining over 250%, but is down slightly since.
The cable and broadcasting company, which owns the home shopping network ShopHQ, is attempting to transition into a digital commerce company after a proxy battle last summer ended with the ouster of much of the company’s top management and board of directors.
Disclosure: None
