Renzo Dancourt
Long/short equity, deep value, special situations, contrarian No Spider Will Save This Web

Ticker: WWWW

Current Price [10/1/13]: $33.17

Target Price: $16.75

Recommendation: SHORT (WWWW) (or 4W) has enjoyed one of the biggest years of any stock in the market, returning 124% YTD. With 3 consecutive quarters of mid-single digit average-revenue-per-user (ARPU) growth, investors jumped in the bandwagon of this ARPU growth story. As a result, valuation ran up close to 5x TTM revenues. Management's low-teens revenue growth target gave the street ammo to support this valuation. My analysis will demonstrate this is a web of illusions.

YTD Stock Price Performance vs. TEV/Revenue (Source: Capital IQ)

(click to enlarge)

4W's biggest success has been selling the upsell/cross-sell story to the street, while misguiding investors with aggressive non-GAAP reporting. This is

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