Riverbed Technology Inc Com (NASDAQ:RVBD)

CAPS Rating: 4 out of 5

The Company is into development of innovative and comprehensive solutions that address the inter-related root causes of poor performance of wide-area distributed computing: latency and protocol chattiness, and bandwidth limitations.

Recs

5
Player Avatar Jeffrey2012 (< 20) Submitted: 8/7/2011 7:31:16 AM : Underperform Start Price: $31.60 RVBD Score: +90.26

The company's performance is secretly deteriorating behind a wall of overly optimistic growth forecasts. During the past 2 quarters, DSO has gone from 27 - 28 - 37 in the recent quarter. For a company that is growing by 35+ avg, this is a bit disconcerning.

Another issue: the company has had tremendous insider selling through out the year. As I go over their 10Q and conference calls over their bubbly outlooks over their business, they seem to be running for the exits behind the scenes. Terrible management guidance.

Another issue: for a company that claims to have the best technology and is the current leading supplier of wan technology, they sure can't seem to stop with the acquisitions. They are not being clear about the costs of the acquisitions and I am thus concerned if they are over paying for niche technologies that they claim are so underserved.

Another issue: their share count keeps balooning after shrinking which is very disingenuous shareholders. Their growing share count will force them to make up for the eps dilution to keep ever growing bottom line results which may very well cause a flameout in the coming 2nd half.

Their 2nd half performance will likely be severely impacted due to the ever deteriorating conditions arising from the sovereign crisis in Europe and the potential for serious fiscal contraction in the U.S amongst others.

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