Entering text into the input field will update the search result below

Box Is No Longer A Deal

Apr. 12, 2021 10:50 AM ETBox, Inc. (BOX)IBM, MSFT8 Comments
Virginia Backaitis profile picture
Virginia Backaitis


  • Box looked like a good investment while rumors circulated that the company would likely be acquired or that activist investor Starboard Value would take control of its board.
  • Last week PE firm KKR announced a $500 million investment in Box. Box shares immediately dropped 10 percent because a sale or Starboard control became less likely.
  • Starboard was pressuring Box to exercise financial discipline, which Box did. That pressure may soon be gone if Starboard sells its shares.
  • Box's stock generally gains based on investor sentiment rather than actual company performance. Unless share prices drop substantially, investors, at least for the short term, are unlikely to be all that interested.
  • Box's stock has a long history of underperforming, regardless of the company's results. There's little reason to expect that to change now. Any gains in share price will be marginal or short lived.
TechCrunch Disrupt San Francisco 2019 - Day 1
Photo by Steve Jennings/Getty Images Entertainment via Getty Images

Box CEO Aaron Levie could almost be called the world's greatest salesman. Get him in a room with the media, private equity firms, technology big shots, or venture capitalists and they'll hand him the world. That is unless they are the types who weigh track

This article was written by

Virginia Backaitis profile picture
I have covered enterprise technology as a reporter for more than 15 years. I know what tech executives say when they aren't pitching investors, what tech analysts think about products and whether there is, or will be, an appetite for them. I write here to marry my insights into tech investment strategies.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (8)

Box is a DOG. I owned it about 4 yrs ago, dumped it and so glad I did. It has done nothing. I bought Square instead, Best move of my life. It’s called an opportunity cost and there is a big cost holding onto this weak security.....sell and put your money in and S&P index fund worst case you’ll achieve market returns
What did KKR see then? They need 3-4x cash on cash returns over 3-5 years.
Virginia Backaitis profile picture
@RestaurantGuy2 I can't speak for them or for the many many investors that lost time and money over a 5+ years on Box. And I'm not saying that Box is never a buy, at $14 or below, I'd be tempted to gamble if I had spare change.
If these experts are so much smarter and better at making decisions then why not start a competing company?
Virginia Backaitis profile picture
@firsTraveler There are 16 competitors out there.
I completely disagree with your premises of just because the stock is been rangebound while the company is been growing decent rate and actually is free cash flow and they're doing the right things specifically with their recent purchase. KKR isn't dumb to throw 500M at this, I take that selloff as an opportunity.

Go check out Nuance (NUAN) chart and pull it back 5 years and then see what happened. I would disregard this "opinion" piece and hold on to this stock and on further weaknesses. Box is making the right moves and I believe we'll see 30+ by year-end as long as the overall market stays intact and we don't blow up.

If Microsoft is dumb enough to wait 5 years to acquire Nuance when it was 1/5 of what it was last year then I'm sure another whale will kick the tire on this one again and either way they're moving along just fine.
Looks like the author does not like cash flow.
Old Dude Two Cents profile picture
@Lost-at-sea She’s obviously not a fan.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.