magicJack rallies after Bloomberg talks M&A potential

Bloomberg observes magicJack (CALL +3.8%) execs spent a portion of their Q4 CC (transcript) talking about the similarities between their company and (drumroll...) WhatsApp, and that CEO Gerald Vento later called a question about whether his company is seeking a buyer a "very appropriate" one.

The company (current market cap of $438M) is much more expensive for a prospective bidder than it was going into 2014, thanks to Whitney Tilson's endorsement, a big Q4 beat,  and strong 2014 guidance.

If a buyer surfaces, it might be on account of magicJack's free VoIP calling apps, which had 6.9M registered users at the end of 2013 (+23% Q/Q) in a very competitive market featuring Skype, Facebook Messenger, Tango, and many others. WhatsApp will be joining the fray soon.

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Comments (1)
  • ruckusnow
    , contributor
    Comments (2) | Send Message
    MagicJack is for folks with a telephone, the future is allIP mobile ! And what about their sales model : Selling yearly plans, eg cash coming in first but what about renewals & revenue recognition. Questionable competitive advantage
    20 Mar 2014, 12:28 AM Reply Like
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