5. Clarivate Plc (NYSE:CLVT)
Total Number of Shares Owned: 38,929,635
Total Value of Shares Owned: $221,510,000
Number of Hedge Fund Investors: 27
Clarivate Plc (NYSE:CLVT) is an appealing investment opportunity, driven by its steady growth in data analytics and intellectual property services. In its recent Q2 2024 earnings report, Clarivate Plc (NYSE:CLVT) showed strong financial performance, with revenue rising due to increased demand for its analytics and workflow solutions. This growth reflects Clarivate Plc (NYSE:CLVT)’s ability to adapt to the changing needs of researchers, businesses, and institutions.
A key part of Clarivate Plc (NYSE:CLVT)’s strategy is its commitment to innovation. Clarivate Plc (NYSE:CLVT) has been enhancing its platform by integrating advanced data analytics and machine learning, which help clients gain valuable insights. Recent updates included new features designed to improve user experience and streamline research processes, reinforcing Clarivate Plc (NYSE:CLVT)’s position as a leader in the research and innovation sector.
Additionally, Clarivate Plc (NYSE:CLVT) has been pursuing strategic acquisitions that have strengthened its market presence. By acquiring relevant technology firms, Clarivate Plc (NYSE:CLVT) has expanded its service offerings and broadened its customer base, creating opportunities for cross-selling and upselling. This approach not only boosts revenue but also fosters customer loyalty.
The growing emphasis on research and development in industries like pharmaceuticals and technology further positions Clarivate Plc (NYSE:CLVT) for success. As organizations increasingly invest in intellectual property and data-driven decision-making, Clarivate Plc (NYSE:CLVT)’s solutions become essential. With a strong balance sheet, Clarivate is well-prepared to invest in future growth while effectively managing its debt, providing stability to navigate market fluctuations.
Cove Street Capital Small Cap Value Fund stated the following regarding Clarivate Plc (NYSE:CLVT) in its Q2 2024 investor letter:
“We also added a position in Clarivate Plc (NYSE:CLVT), a data services provider that operates across academic research, intellectual property, and life sciences. We came to the investment from cross-work in another holding, Research Solutions (ticker: RSSS). Ultimately this company sucks in data from participants in the industry, aggregates it, and provides value added services and tools back to those industry participants.
The power is in providing customers access to the aggregate. This was a private equity roll-up of a bunch of different data assets that paid too little attention to product innovation, leading to a period of stagnating growth and repeatedly missing guidance. The business of selling many tools and services on a pile of fixed cost assets (data) remains tremendous as can be seen by Clarivate’s mid-to-high 30% EBITDA margins and strong returns on invested capital.
With new management and board members in place and 18 months of an “investment cycle” under their belt, we view the risk/reward of CLVT to be favorable at these levels, with a strong upside case if they can reinvigorate growth to their target levels.”
