Carbonite, Inc. (NASDAQ:CARB)

CAPS Rating: 1 out of 5

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Player Avatar MoneyDocSchloss (68.90) Submitted: 8/12/2011 8:30:29 PM : Underperform Start Price: $13.80 CARB Score: +46.57

This is a business model that is easy to replicate. It's very plausible to expect Google to offer something very similar for FREE before you know it.

IPO-inflated price DURING this current market's punishment just spells bad news.

There is little reason to believe why this price should go any higher in the short term. The main players making money off this IPO are BAC and JPM.

-Lee

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Member Avatar wilmap47 (< 20) Submitted: 8/16/2011 11:38:04 PM
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This comment is about the business model of Carbonite from the perspective of a computer pro. I was a software developer for 30 years and I know when software works seamlessly and flawlessly. Carbonite backup is completely transparent to the end user. Its price is very reasonable and it is the best way to backup your important files.

I have had it for a few years and am very happy with it. It is a very simple model but is extremely well executed. Having your files "offline" means they are not dependent on your computer and other hardware. Perhaps Google or someone else can easily offer this service but they will not offer gigabytes of storage for free.

Member Avatar MoneyDocSchloss (68.90) Submitted: 8/17/2011 12:00:03 AM
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I don't doubt the service is good. And you're right, it might be a long while before it's offered for free, if ever. My concern is that the competition will be robust as I've already seen a number of other companies that offer the same thing. If there was something materially specific about Carbonite that no one else could offer, then I might be beating to the drum of a different tune. The only reason I see this going UP in the short term would be because of enthusiastic momentum. Otherwise, I can't be convinced this is a solid investment.

-Lee

Member Avatar TSIF (99.96) Submitted: 8/24/2011 2:18:41 PM
Recs: 1

Good dialogue. Wilmap47 when you are evaluating companies then your comments would cover the first steps. Before making an investment, however, you need to apply your thoughts to valuation. Many, many, goood ideas come to market, but finding an entry point if/when for an investment is difficult. IPO's in particular are difficult and a few quarters evaluation is usually worth the wait. A moat is very good to have in the technical field, and as MoneyDocSchloss indicates, Carbonite doesn't have a very good one, so an optimal entry point is critical.

Using what you know is a good start for the research, but only a start. Good luck.

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