Riverbed Technology, Inc. (NASDAQ:RVBD) Zooms After Buying By Activist
Riverbed Technology, Inc. (NASDAQ:RVBD)‘s shares jumped 16% Friday, after activist investor Elliot Associates said it has bought a 9% stake in the Riverbed Technology.
Elliott, which has a history of investing in technology companies, called Riverbed’s shares “significantly undervalued”, and even encouraged the company to find ways to increase shareholder value.
Riverbed can immediately boost shareholder value by employing a strategic review to best optimize its operational and capital structure initiatives, said Elliott. Elliott Associates said it is even open to a “constructive” dialogue with Riverbed on the same.
On the matter, Riverbed Technology, in its SEC filing, said: “Riverbed is focused on creating value for all of our shareholders, and maintains an open dialogue with our shareholders, including Elliott.” The company further continued saying, “Riverbed is pursuing a considered strategy for growth by establishing itself as the leading multi-product platform delivering a complete solution for application and network performance across platforms, locations and devices.”
In the filing, the company said it looks forward to meeting with shareholders and further discuss its strategy at Riverbed Technology, Inc. (NASDAQ:RVBD)’s upcoming analyst day on Nov. 18, 2013.
The wide area network specialist recently reported 20% increase in its GAAP revenue of $262 million for the third quarter of 2013, compared to $219 million reported during Q3, 2012. GAAP net income was $3.8 million, or $0.02 EPS, compared to $24.7 million in GAAP net income, or $0.15 EPS for the same period of 2012.
Riverbed Technology, Inc. (NASDAQ:RVBD and peers such F5 Networks, Inc. (NASDAQ:FFIV) and Juniper Networks, Inc. (NYSE:JNPR) are benefiting from beefed up telecom spending by large mobile carriers to upgrade their networks. One of Riverbed competitors F5 Networks, Inc. (NASDAQ:FFIV) recently reported a “stronger” quarterly results with net income of $76.2 million, or $0.97 EPS in the fourth quarter, from $67.7 million, or $0.85 EPS reported during the same quarter a year ago.