Active Network evaluates investment, buyout plan

By IVCPOST Staff Reporter

Aug 02, 2013 02:02 PM EDT

Active Network's shares rose 25% during midday trading on Friday. This was after the corporation said on Thursday that its board was considering proposals to purchase or invest in the company.

Active Network currently provides cloud software technology to companies that would allow them to manage their events. The corporation also reported its second quarter earnings that surpassed the estimates of Wall Street. Active Network said its revenue climbed 9% to US$132.4 million. Analysts only expected US$130.4 million. Furthermore, the company forecasted a revenue of US$113 million to US$116 million, up 3.4% to 6.2% in the third quarter. Conversely, analysts predicted a US$117.5 million worth of revenue for the company. Jefferies & Co.'s analyst Brian Pitz increased his price target on Active Network to 10 from just 8.

"Active Network reported a beat quarter with lighter-than-expected Q3 and FY13 guide, but management has reset priorities and margin expansion is expected to be steeper now," Pitz wrote. "While we believe the stock will trade on this (investment or acquisition) news in the near term, we reiterate our buy rating and raise the price target to $10 based on Active Network remaining independent."

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