Software Provider Omniture is Worth a Hard Look

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Omniture (OMTR) is a Web Analytics software provider which enables businesses to monitor and analyze their online business, including static pages and transactional sites. The company competes head to head with Web Trends - an older, more established software provider, but boasts a better looking product than them.

Omniture has made a big run from $15 to $17 the last couple of weeks - and this in addition to doubling from its IPO price of $7 and change just last summer. In fact, it was and perhaps still is one of the least talked about IPO's of last year - remember Under Armour (NYSE:UA), Vonage (NYSE:VG), Nymex (NMX), Mastercard (NYSE:MA) etc.?

The company released earnings yesterday and reported a record quarter with quarterly revenue growth of 71% above last year, along with an annual revenue growth of 86% in 2006 vs. the previous year. They lost $0.02 per share in Q4 of 2006 compared to $0.52 in Q4 of 2005. More importantly, they are looking to increase revenues by 60% in 2007, along with EPS growth of over 40%.

During this last quarter of 2006, Omniture added over 250 new customers, bringing the total to approximately 1,800 and captured data from over 420 billion transactions. Their customers include the likes of Ameritrade (NASDAQ:AMTD), Anheuser Busch (NYSE:BUD), Apple (NASDAQ:AAPL), Boston Scientific (NYSE:BSX), Countrywide (CFC), eBay (NASDAQ:EBAY), Ford (NYSE:F), H-P (NYSE:HPQ), Goodyear (NYSE:GT) and Microsoft (NASDAQ:MSFT) to name a few.

The company's vast showcase of customers illustrates the importance of this business intelligence [BI] tool. Most of their companies have high impact online businesses if not an entirely online business model. I have liked Microstrategy (NASDAQ:MSTR) - another BI tool since the stock traded in the teens back in early 2003 and the stock has produced gains of 600% since then. I believe OMTR, is capable of generating at least 200% over the next couple of years. Here is why:

* Companies are constantly looking for ways to generate leads and revenue online. This software enables them to track their consumer movements click by click, along with any and all metrics one could think of.
* The software is easy to use and intuitive - executives actually use this tool.
* Implementation times are generally quicker than other business applications.
* Companies are sitting on a lot of cash that they are using to invest in such technologies.

I recommend buying this stock at $16 or lower.

Full Disclosure: I do not own OMTR but my position might change anytime without notice.