Mike Arnold
Long only, small-cap, tech, growth at reasonable price

Update On Rosetta Stone: An Undercover (And Undervalued) SaaS Business

Executive summary:

  • Investors continue to turn their nose up at Rosetta Stone (NYSE:RST), placing too much attention on the consumer segment and not enough on the Education & Enterprise segment.
  • SaaS revenue continues to grow at healthy pace, and is underappreciated by the market.
  • $13.5 million remaining in share buyback program.


Buying at low prices is always better than buying at high prices. Intuitively, low prices provide investors a "margin of safety" when investing in an uncertain environment.

The world seems pretty uncertain for Rosetta Stone investors at this moment.

The stock continues to trade at 52-week lows and the overblown fears of competition from sexy startups like Duolingo continues to instill fear. Rosetta Stone's recent investor...

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