Stock Alert for Local.com Corp. (LOCM) " />

Stock Alert for Local.com Corp. (LOCM)

Local.com Corp. (LOCM) owns and operates a leading local search site and network in the United States. The Company uses patented and proprietary technologies to provide more than 20 million consumers each month with relevant search results for local businesses, products and services on Local.com and more than 1,000 partner sites. Local.com powers more than 100,000 local Web sites, and tens of thousands of small business customers use Local.com products and services to reach consumers using a variety of subscription, performance and display advertising and Web site products.

LOCM was founded in 1999 and is based in Irvine, California.

Share Statistics (21-Dec-10) FY

2008

FY

2009

%

Chg

Q3

2009

Q3

2010

%

Chg

Symbol LOCM Revenue, $Mn 38.26M 56.28M 47.1% 15.13M 22.46M 48.4%
Current price $6.75 Gross marg. 86.2% 89.8% 4.2% 41.4% 52.3% 26.3%
52wk Range: $3.22-$8.85 Oper. margin -5.5% 8.9%
Avg Vol (3m): 968,802 Net margin -22.4% -11.1% -50.4% -9.2% 16.7% -281.5%
Market Cap. 111.87M
Shares Outstanding 16.57M EPS, $ -0.60 -0.44 -26.7% -0.10 0.22 -320%

Source: Reuters.com, SEC Filings.

Financial Summary

For the third quarter of 2010, LOCM reported revenue of $22.5 million, an increase of 48% over the third-quarter 2009 revenue of $15.1 million.

Third-quarter 2010 Adjusted Net Income of $4.6 million or $0.27 per diluted share represents an increase of 249% over third quarter 2009 Adjusted Net Income of $1.3 million or $0.09 per diluted share.

Third-quarter 2010 GAAP net income was $3.7 million or $0.22 per diluted share, compared to third-quarter 2009 GAAP net loss of $1.4 million or ($0.10) per diluted share. Third-quarter 2010 and 2009 GAAP net income included a gain (loss) on warrant revaluation of $1.8 million and ($1.2) million or $0.11 and ($0.08) per diluted share, respectively.

On Sept. 30, 2010, the Company’s cash balance was $11.9 million. During the third quarter 2010, the Company used $3.8 million in cash related to the OCTANE360 acquisition, $3.3 million in cash for capital expenditures, including capitalized Web site development costs, and $1.2 million in cash to repurchase shares of its common stock. These cash expenditures were partially offset by $4.0 million of incremental borrowings on the line of credit and $1.0 million positive cash flow from operations.

On Sept. 30, 2010, the Company had borrowings of $7.0 million outstanding under its $30 million revolving line of credit.

Source: www.local.com

F

Financial Strength (21-Dec-2010) Company Industry Sector S&P 500
Quick Ratio (MRQ) 1.15 1.16 0.67
Current Ratio (MRQ) 1.22 2.94 2.18 1.00
LT Debt to Equity (MRQ) 0.00 17.92 14.77 118.61
Total Debt to Equity (MRQ) 17.80 24.98 23.30 172.83
Interest Coverage (TTM) 0.50 1.53 18.91

Source: Reuters.com, SEC Filings.

Analyst Consensus

This is the consensus forecast among three polled investment analysts. Against the Local com Corp company.

Analyst Detail Buy Outperform Hold Underperform Sell No Opinion
Latest 3 0 0 0 0 0
4 weeks ago 3 0 0 0 0 0
2 months ago 3 0 0 0 0 0
3 months ago 3 0 0 0 0 0
Last year 3 0 0 0 0 0

Source: markets.ft.com

Consensus Estimates Analysis


# of Estimates Mean High Low 1 Year Ago
SALES (in millions)
Quarter Ending Dec-10 3 22.59 23.00 22.18 17.70
Quarter Ending Mar-11 2 23.67 24.05 23.29
Year Ending Dec-10 3 86.68 87.09 86.27 68.28
Year Ending Dec-11 2 101.41 103.10 99.71
EARNINGS (per share)
Quarter Ending Dec-10 3 0.03 0.06 0.01 0.02
Quarter Ending Mar-11 1 0.03 0.03 0.03
Year Ending Dec-10 3 0.33 0.36 0.31 0.05
Year Ending Dec-11 1 0.14 0.14 0.14

Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=LOCM.OQ


Investment Highlights

Local.com is known for delivering highly relevant search results to millions of consumers each month for local businesses, products and services on Local.com and more than 1,000 partner sites. Local.com owns or manages over 100,000 geo-category domain sites, and tens of thousands of small business customers use Local.com products and services to reach consumers using a variety of subscription, performance and display advertising and Web site products. Local.com’s products and services are offered through the Company’s three business units: Owned & Operated (O&O); Sales and Advertiser Services (SAS); and Network.

Recent News

LOCM shares jumped yesterday following New York Post report that Google (NASDAQ: GOOG) is looking to acquire a competitor of online coupon provider Groupon.

Groupon recently turned down a $6 billion takeover bid from Google.  But with the search giant’s interest in the growing niche of local online advertising, investors are speculating that Google is going after Groupon’s competitors.

Like Groupon, LOCM also engages in local online advertising, helping local businesses target Internet consumers.

Technical Analysis

Source: http://stockcharts.com

LOCM is trading above its 13-day moving average. This is considered to be the sign of a bullish trend. There is added weight to this indication because the moving average is rising and suggests that there has been buying interest in this stock.

LOCM’s recent volatility has been greater than normal. This is evidenced by the increased distance between the upper and lower Bollinger Bands. These bands measure volatility using standard deviation and a large width is due to high volatility.

The MACD for LOCM currently indicates a strong bullish signal for two reasons. First, the MACD is above the signal line, a 9-day moving average. Second, the MACD is above 0, which implies that the underlying moving averages are trending higher.

Comparative Analysis

Company Name Ticker Price per Mrkt. Cap. P/E P/S
Dec21-2010 symbol Share, $ $ Mn 2010 2011 2010 2011
SuperMedia Inc. SPMD 8.48 131.47M 0.07 0.07
Yahoo! Inc. YHOO 16.63 21.67B 19.34 21.32 4.74 4.60
Microsoft Corp. MSFT 28.08 240.28B 11.46 10.44 3.50 3.27
Google Inc. GOOG 603.73 193.06B 20.95 18.05 8.90 7.53
InfoSpace Inc. INSP 8.18 295.58M 136.33 51.13 1.22 1.18
Internet Information Providers Median 21.60 n/a 2.03 n/a
Local.com Corp. LOCM 6.75 111.87M 8.23 7.58 1.29 1.10

Source: Thomson Financial

Insider Trading Activity

NET SHARES PURCHASE ACTIVITY

Inside Purchases – Last 6 Months

Shares Transaction
Purchases n/a 0
Sales 768,403 34
Net Shares Purchased (Sold) (768,403) 34
Total Insider Shares Held 346.87K n/a
% Net Shares Purchased (Sold) (68.9%) n/a
Net Institutional Purchases — Prior Qtr to Latest Qtr
Shares
Net Shares Purchased (Sold) (3,859,460)
% Change in Institutional Shares Held (37.87%)

Source: Yahoo Finance

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