Omniture, Inc. (OMTR)

spoorts (< 20) Submitted: 1/04/08 4:35 PM : Start Price: $11.35 OMTR Score: 24.24

Internet ad revenue climbed 35% in 2006 with no letup in sight. OMTR is the market leader in this segment according to analyst Richard Baldry of Canaccord Adams. It keeps winning blue chip clients (300 during the most recent quarter) including most recently Disney. Client renewal rates are greater than 95%. IDC has OMTR ahead of WebTrends for the lead position. Visual Sciences is third, but OMTR bought them giving the combined company a significant lead in this space.

The SaaS platform gives them predictable revenue performance for multiple years to come. The market for Web analytics software and services will reach 1 billion by 2010. Less than 20% of the 10,000 most visited web sites use web analytics. As CEO Josh James states it is like "flying an airplane without the instrument panel". OMTR has barely scratched the surface.

Concerns over competition are legitimate but OMTR clearly has differentiated its service offering and keeps adding to its appeal through key acquisitions such as Visual Sciences and Offermatica. As a former CEO of an analytics company, there are vast differences in analytics offerings. This is not a commodity particularly where this type of offering is concerned. The technical term according to IDC is opportunity analytics (as opposed to control analytics). Simply put, this type of application helps you make money.

Finally, I think OMTR is an acquisition target.

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