LivePerson, Inc. (LPSN): Is This Stock a Good Buy After a Recent Correction?

Constant Contact Inc (NASDAQ:CTCT) is the other company which posted strong first-quarter 2013 results. The company beat the consensus estimate for both revenue and EBITDA margin. The company has shown consistent growth in new customer additions and ARPU in the last few years. I believe increasing its portfolio of new products and expanding globally will increase its new customers and ARPU in coming quarters. Recently we have seen consolidation in the cloud-based application providers. We believe that further consolidation will take place, which makes Constant Contact a candidate for takeover. Hence, I am optimistic about the company.

Conclusion

LivePerson reported a subdued last quarter and also downgraded its guidance for 2013, based on client attrition. We believe that the company will keep on investing in new platforms and international expansion, which will lower its EPS in coming quarters. In the long term, the investment will help the company attract new customers and increase its top line. With the market cap down to around $500 million, the company is also a potential takeover candidate by the larger firms in the industry. At the current market price, the stock can see upward movement with high probability of acquisition.

The article Is This Stock a Good Buy After a Recent Correction? originally appeared on Fool.com and is written by Lalit Kumar.

Lalit Kumar has no position in any stocks mentioned. The Motley Fool recommends LivePerson. Lalit is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.