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Analyst Blog

On May 30, 2014, we issued an updated research report on j2 Global Inc. (JCOM - Analyst Report).

j2 Global has delivered positive earnings surprises in all four quarters last year, with an average beat of 9.35%. The company reported first-quarter 2014 financial results wherein the bottom line surpassed the Zacks Consensus Estimate while the top line was at par with the same.

At present, j2 Global commands approximately 30% of the world’s cloud-based digital faxing system. Despite facing global macroeconomic volatility, the company has successfully boosted sales to its credit-sensitive clients.

Recently, j2 Global bought Critical Software Ltd., a U.K.-based Email Security and Management company operating under the brand name of iCritical. Earlier, the company had acquired two Australian Internet fax business service providers.

The buyouts include Sydney-based OzeFax and Brisbane-based Faxmate. These acquisitions will likely strengthen j2 Global’s fax business in Australia. j2 Global’s achievement of record revenue growth in fiscal 2013 marked another positive for the company. This also encouraged the company to raise its outlook for fiscal 2014.

j2 Global expects to capitalize on the increasing demand for cloud based, value-added communication, messaging and data backup services. Segment wise, j2 Global continues to improve its powerful eFax brand with creative content and designs. Strong free cash flow and low leverage have induced the company to execute five buyouts in 2013.

j2 Global currently carries a Zacks Rank #2 (Buy).

Stocks That Warrant a Look

Other well-performing stocks in the Internet/Application software industry include Cvent, Inc. (CVT - Snapshot Report), TeleCommunication Systems Inc. (TSYS - Snapshot Report) and DTS Inc. (DTSI - Snapshot Report). All three stocks currently sport a Zacks Rank #1 (Strong Buy).

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