Celcuity Inc. (CELC) Q4 2018 Earnings Conference Call Transcript

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Celcuity Inc.  (NASDAQ: CELC)Q4 2018 Earnings Conference CallFeb. 26, 2019, 4:30 p.m. ET

Contents: Prepared Remarks Questions and Answers Call Participants Prepared Remarks:

Operator

Please stand-by. Your program is about to begin. (Operator Instructions) Now I would like to turn the call over to Brian Sullivan, Chief Executive Officer.

Brian Sullivan -- Chief Executive Officer and Co-Founder

Thank you and good afternoon, everyone. We announced the financial results for our fourth quarter and year ended December 31, 2018 a few minutes ago. Before I begin though, I'd like to remind listeners that our comments today will include some forward-looking statements. And these statements involve number of risks and uncertainties which are outlined in today's press release and in our reports and filings with the SEC. Actual results may differ materially from those in the forward-looking statements.

On this call, we'll also refer to non-GAAP financial measures. You can find a table reconciling the non-GAAP financial measures to GAAP financial measures in our earnings release for the three and six -- 12 months ended December 31, 2018, which was included in today's press release. Today's press release is available on our website, www.celcuity.com, under the Investors section. Also on the call with me today is Vicky Hahne, our CFO. I'd like to make some comments on our fourth quarter and full year results as well as provide a general outlook for 2019. And then Vicky will follow with a few more details on a few items and then we'll open the line for questions.

We made significant progress in 2018 on variety of fronts and achieved many of our critical objectives. Our overarching goals were to advance CELx platform and expand our pharmaceutical and clinical collaboration. In particular, I would note the following accomplishments. Our first clinical trial FACT 1 was activated in collaboration with Genentech and the NSABP Foundation. FACT 1 trial is evaluating the safety and efficacy of Genentech's drugs and HER2-negative breast cancer patients selected with Celcuity's HSF Test. We signed a clinical trial agreement with Puma Biotechnology and West Cancer Center to conduct a Phase II clinical trial, known as FACT 2, to evaluate the efficacy and safety of Puma's drug, Nerlynx and chemotherapy, in breast cancer patients selected with Celcuity's HSF Test.

And third, we were also selected by NSABP and Puma to evaluate tissue samples from a Phase II study they're conducting that are evaluating Puma's pan-HER inhibitor, Nerlynx, Genentech's HER2 antibody, Herceptin, and Bristol-Myers Squibb's EGFR inhibitor, Erbitux, in metastatic colorectal cancer patients. Fourth, we completed development of our second CELx signaling function Test for HER2-negative breast cancer. And with this test we confirm the capability of our platform to analyze the activity of multiple signaling pathways to expand the patient population we can diagnose.

The second test identifies HER2-negative cancer patients -- breast cancer patients who have hyperactive and co-activated HER family and c-Met signaling activity. We also advanced development of several new CELx signaling function tests to diagnose new cancer sub-types, including a third test for breast cancer and tests for two new tissue types. And then finally, we presented results of several pre-clinical studies at major conferences, including the American Society of Clinical Oncology, the Miami Breast Cancer Conference, and the San Antonio Breast Cancer Symposium.

The FACT 1 clinical trial that we activated this year and is evaluating Genentech's targeted therapies in patients our CELx test selects now has 14 activated sites. While this is consistent with our goal at the beginning of 2018, the enrollment rate of patients at these sites has so far been below NSABP's original expectations. And to offset the lower than expected enrollment rate, NSABP has agreed to activate up to 16 additional sites, for a total of 30 sites. The process to add additional sites has began and expect to began activating new sites this quarter and on a rolling basis to the first half of 2019. We expect the addition of the new sites to increase Celcuity's cost for the FACT 1 trial by up to $650,000. We now expect interim results from this trial in late 2019 and final results approximately nine months later.

The FACT 2 clinical trial that is evaluating Puma's targeted therapy, Nerlynx, in patients our CELx test selects has received all required regulatory and Institutional Review Board approvals and is expected to be activated later this quarter -- in early 2019. We expect interim results from this trial in late '19 or early '20 and final results approximately 12 months later. As we look ahead to the remainder of 2019, we've then identified a number of key objectives. First, we anticipate reporting interim results from our first clinical trail FACT 1 and progressing toward interim results for early 2020 in our second clinical trail FACT 2.

Second, we anticipate completing development of another cell signaling function test for breast cancer that diagnoses a new sub-type of breast cancer not currently detected with molecular test. Our CELx platform enables us to create unique insights into the FACT signaling to function driving a patients cancer that the molecular test could not detect. And this allows us to assess the cross-talk between different signaling pathways in a very powerful way. An example of this was the CELx test we announced last year that identifies patients with co-activated c-Met and HER family signaling.

Our platform allowed us to characterize the cross-talk between this path -- new pathways, so that we could not only identify patients who c-Met and HER family pathways were hyperactive, but determine the best drug combination approach to treat it. Third, we anticipate completing development of test for two new tissue types. Each of these new tests create opportunities for us to provide companion diagnostics that enable pharmaceutical companies to obtain new drug indications for the cancer sub-types or test diagnose.

And fourth, we hope to initiate at least one additional clinical collaboration with the pharmaceutical company by year end to study breast cancer patients identified by our CELx MP test with hyperactive and co-activated HER family and c-Met signaling activity. We're currently engaged in productive discussions with a number of pharmaceutical companies. We hope to work with these companies first to evaluate the efficacy of their targeted therapeutics and new patient subgroups or CELx does identify and if successful to help these therapies gain FDA approval to treat this patient population.

We believe our CELx test offer the opportunity to expand the patient population for targeted therapeutics beyond patients selected using molecular biomarker. And we hope to evaluate the efficacy of additional targeted therapies in breast cancer patients who have either HER2's tumors or co-activated HER2 and c-Met tumors. Our approach to identifying new cancer sub-type is new and the patient populations we identify are not initially on the clinical roadmap for the targeted therapies of interest to us. So while it is difficult to break the timing of our next collaboration agreement. We think it's reasonable for us to expect closing another one this year. Overall. We're excited about the progress we made during quarter and the year.

To review our financial results, I'd like to turn it over to Vicky.

Vicky Hahne -- Chief Financial Officer

Thank you, Brian. Our fourth quarter net loss was $1.8 million or $0.18 per share compared to $1.7 million net loss or $0.17 per share for the fourth quarter of 2017. Net loss for fiscal year 2018 was $7.5 million or $0.74 per share, compared to $6.3 million or $0.84 per share for the same period in 2017. Because this quarter and year-to-date net losses include significant non-cash items, stock-based compensation and non-cash interest expense. We also include in our press release non-GAAP adjusted net loss for the quarter.

Our non-GAAP adjusted net loss was $1.6 million or $0.15 per share for fourth quarter of 2018, compared to non-GAAP adjusted net loss of $1.4 million or $0.14 cents per share for the fourth quarter of 2017. Non-GAAP adjusted net loss for fiscal year 2018 was $6.3 million or $0.62 per share compared to non-GAAP adjusted net loss of $4.9 million or $0.66 per share for fiscal year 2017.

R&D expenses increased approximately $1.3 million (Technical Difficulty) fiscal year 2018, compared to fiscal year 2017. This was primarily due to $0.6 million increase in compensation related expenses to support development of our CELx platform. In addition other R&D expenses increased $0.7 million, due to clinical validation and laboratory studies, legal expenses related to patent costs and operational and business development activities.

Approximately $0.6 million in G&A during increased -- during fiscal 2018 compared to fiscal 2017, primarily resulted from $0.4 million increase in professional fees associated with being a public company for a full year in 2018 versus only one quarter in 2017, and director and officer insurance. Other G&A expenses increased $0.2 million in compensation related expenses, including non-cash stock-based compensation. We ended the year with approximately $24.9 million of cash, cash equivalents and investments.

Brian Sullivan -- Chief Executive Officer and Co-Founder

All right. Well, thank you, Vicky. Operator, we'd like to take some questions now please.

Questions and Answers:

Operator

(Operator Instructions) We'll go ahead and take our first question from Yi Chen. Please go ahead. Your line is open.

Edward Marks -- H.C. Wainwright -- Analyst

Hi. This is Edward Marks (ph) on for Yi. Just a quick question on FACT 1, I was wondering if there is a possibility for any future delays after the end of this year?

Brian Sullivan -- Chief Executive Officer and Co-Founder

The driver of when we would expect interim results is a function of how quickly enroll patients and how quickly we get to new sites on-board. So far we think we're making good progress and adding the new sites. We're dependent on the estimates for enrollment to be consistent with what we currently expect. But if the rate of enrollment is not what we expect and that would push it out, that's really the major variable there. Currently, we don't expect that to occur, but there are variables that could affect it.

Edward Marks -- H.C. Wainwright -- Analyst

Okay. And a couple more questions just on the platform. If you could provide a little more color on the CELx MP collaboration you're anticipating for the end of 2019? You mentioned a little bit on your prepared remarks.

Brian Sullivan -- Chief Executive Officer and Co-Founder

Right. Now, so we don't have anything to announce yet, but as we discussed when we launched the test and announced the test last year, we have an opportunity to Help pharmaceutical companies get a new indication for a combination treatment with pan-HER inhibitor and c-Met inhibitor. And so the process of engaging with pharmaceutical companies has been ongoing. We're making progress on that front. There are a number of companies that we're engaged in discussions with. The collaboration itself would -- we would anticipate take the form of a clinical trial approach similar to what we've put in place with Puma and Genentech, where the goal is to evaluate the efficacy of their drugs in the patient population we select, as really the first step in working, what we hope would be toward an approval for that drug combination to treat those patients.

Edward Marks -- H.C. Wainwright -- Analyst

Yeah. Okay. And then the final question just on the two new tumor types you are exploring. Can you provide a little more detail on maybe what tumor types there and any potential partnerships that you might be anticipating for those tumor types as well?

Brian Sullivan -- Chief Executive Officer and Co-Founder

Right. So until we completed development and have studies ready to present. We won't be announcing the tumor types just for confidentiality, but the model that we would pursue with the development of tests and these all tissue types will be very similar to what we've done in breast cancer, where we would identify signaling dysfunction, pathway disease and that would be the basis for partnering and collaborating with pharma to field a trial to evaluate the patients our test selects, again the first step toward a potential new indication. And with those tasks we would expand the range of collaboration -- really is the goal would be to expand the range of collaborations and potential opportunities for us to position our CELx test as companion diagnostics for new drug indications.

Edward Marks -- H.C. Wainwright -- Analyst

All right. Thank you very much. I appreciate the details.

Brian Sullivan -- Chief Executive Officer and Co-Founder

You're welcome.

Operator

(Operator Instructions) I think we have a question from Per Astlin (ph). Please go ahead. Your line is open.

Per Ostlund -- Analyst

Thanks. Good afternoon, Brian and Vicky.

Brian Sullivan -- Chief Executive Officer and Co-Founder

Hi, Per.

Per Ostlund -- Analyst

I want to go back to FACT 1, so understanding that this is, we're kind of breaking new ground as you noted in your prepared remarks. Brian and so I think most everybody would expect this isn't going to be a fluid situation but is there a way to characterize the why behind the pacing of enrollment. I know originally there had been the issue whose is getting the IRBs or having site specific IRBs versus a central and so that slowed things up a little bit. Is there anything that you would point to in terms of why enrollment itself assuming the IRBs have taken hold at this point. Is there anything that you can point to on the enrollment pacing to explain why it's a little bit short of NSABP's target?

Brian Sullivan -- Chief Executive Officer and Co-Founder

Sure. Well, I -- first, I would say in general most -- if you were to chat with any folks who are involved in clinical trials and the challenges of predicting enrollment what we would tell you that it's a very imprecise art that each side will have to test of competing trials that are in some cases going after the same patients or the clinicians are involved with trials that may lead them to --- not prioritize one trial over another trial. And so, there are some rules of thumb that sites use based on prior history to come up with estimates but anybody that is involved in this business would tell you that there's a high variance associated with those estimates.

When we talk of NSABP and obviously, we're digging into the rate of enrollment. Their answer really is that well this is really just the reflection of the challenges of predicting how many patients are eligible for the trial and how many patients agree to participate in the trial. And those are again just hard to predict, each site will have its own characteristics that in different drivers and really it's -- on the one hand it's complicated because there's a lot of factors that go into getting a patient to enroll. On the other hand it's kind of, somewhat simple and that it's hard to predict and rules of thumb are used and in many cases those rules of thumb don't come through.

For reasons that really have nothing to do with the trial itself but more to do potentially just with the general state of getting patients enrolled in trials the sites that we're working with.

Per Ostlund -- Analyst

Sure. That makes sense. I guess with this question maybe early given that the data -- the interim data will be later this year. But can you characterize the nature of the data that we'll get when that comes out. Is it going to be a PCR rate for an initial tranche of patients that were selected and went through the therapy? Is it going to be something different or is it completely up to Roche's discretion or Genentech's discretion to determine exactly what they release in terms of top line data?

Brian Sullivan -- Chief Executive Officer and Co-Founder

NSABP and Genentech will control what's released, but typically with interim results the -- and depending on whether they are announced in conjunction with a conference where potentially more detail can be provided or announced in between conferences. If it's announced in time to present as part of a release at a breast cancer conference, more detail is usually provided. Typically, the drug companies and research organizations like NSABP provide only top line results until they present data in more detail at a research forum.

If at the top line result essentially what they -- what is typically done is that they would indicate whether the trial has met or on track with its endpoints and or not. And so even with completion of trials and where final data is available before a major meeting the drug companies will indicate that there -- they met their end points and that they will describe the data in more detail and that ex meeting whether it's ASCO or San Antonio Breast Cancer or European ESMO meeting. But I think it would be sufficient detail to indicate whether the goals have been met and we're on track to hopefully achieve what we set out to achieve with the trial.

Per Ostlund -- Analyst

Sure. That makes sense. And I guess maybe dovetailing off of that -- that answer Brian. I assume that there are a range of potential next steps that ensue from the data whether it's at the interim level or final. But does it stand to reason that a larger Phase 3 assuming good data, is in place, as a larger Phase 3 the likely outcome or if the data is just so good could Roche go to FDA with that in hand seeking the additional indication without a Phase 3?

Brian Sullivan -- Chief Executive Officer and Co-Founder

Well again, I can't speak for Genentech and Roche, and so I can only -- I guess provide some thoughts about what the FDA is shown willingness to do when compelling data is made available. They have approved several drugs recently with Phase 2 data. They have a number of pathways -- regulatory pathways as well as an expedited review or accelerated review or breakthrough therapy designation that lead to quick reviews of the data and if favorable quick decisions and approvals. They also have to the extent that they would like further data and for whatever reason whether they just would like a larger sample size. They have changed their practice of requiring separate Phase 2 and 3 trials or at least in cases now they are willing to be more flexible and allow a Phase 2 trial to amend and increase the sample size and in effect more of into a Phase 3 trial.

And those are all options. I can't put Jackson say that's what Genentech would do, but obviously they know what they're doing and they would presumably proceed with what they think is the most efficient manner possible. But the good news for us is that the FDA is very, very focused on finding ways to more precisely identify patients for all the reasons that you'd expect. And they've shown a willingness to be very aggressive in allowing new options to get the market. When there's both no good data for the drug i.e. is safe and effective and they have experience with it, but also when there's a strong rationale for the patient population it's being treated as would be the case with this patient group because of our test.

Per Ostlund -- Analyst

Sure. Sure. Okay. Excellent. A couple more questions. One on the c-Met pathway test, so appreciate the context around striking a collaboration sometime during 2019. Given the -- I would say very promising and good depth of data that you presented at San Antonio Breast in the fall when you're having the discussions with pharma in conjunction with presenting that data and that sort of thing. How do we think about -- how that potential pharma partner looks at that data in terms of striking and collaboration? Are they going to be looking for additional data? Are they going to be looking for the data that's been presented to mature a little further, what sorts of gating factors I guess are there between here in a collaboration.

Brian Sullivan -- Chief Executive Officer and Co-Founder

I think we've put together a very good data package. I think we have a package that's similar if not more complete than what we had available for Genentech and Puma with this new population. We're also published in San Antonio interesting analysis about how these pathways interact, how c-Met and pan-HER well rather HER family pathways are co-activated. And that's very powerful, not only as our ability to assess an individual pathway powerful but the ability to assess how these pathways interact in unexpected ways or ways that haven't really been understood and identified before. Its very intriguing and I think we have sufficient data to support our findings in that area.

And so then the question is OK, what -- why don't these guys all just jump in our lap and move forward. There's a big constituency within these pharmaceutical companies. And sense that it's not too dissimilar from any large organization where you have a lot of people that have to say yes and the many I would say, in many of these organizations at least the larger ones, you generally need a consensus and so that takes time. I mean there's not an individual that we have to pitch and get a yes from. There's a group of individuals across a fairly wide range of departments whether it's translational science or medical affairs, the R&D group, diagnostic group, biomarker group, business development, all those groups tend to participate in the decision making process and we understand that we work all those to engage all those folks.

But it's process and that's why again, we believe we have very compelling data. We've had very productive conversations. And so that's why we anticipate having a collaboration that we can announce this year. But it's again in this case you also have two drugs that makes it somewhat more complicated than us. These are two different drugs, the Genentech drugs, there are two different drugs but they're used in a current indication. So you can almost think of it as a really single decision.

In this case, we're evaluating two different drugs pan-HER inhibitor, c-Met inhibitor that today are not used in combination. So that again requires two different drug groups in some cases to get together and collaborate themselves, which again just not uncommon. It just this is one more variable that needs to be worked through.

Per Ostlund -- Analyst

That's absolutely fair. Thank you for all that color. And then I guess I just last, last question and this one might be maybe more of a Vicky question. So operating expenses I would say have continued to be very, very well controlled here. Is the range that we've seen kind of plus or minus over the last few quarters or reasonable range to think about over the ensuing few quarters, in addition to the 650,000 that you talked about incremental costs for FACT 1 is that really the only additional thing we should be thinking about vis-a-vis the last few quarters run rate for OpEx or is there something else we should be contemplating in our models?

Brian Sullivan -- Chief Executive Officer and Co-Founder

Yeah. I'll just take this first, and then Vicky can add color, I mean we've indicated from the time we did our offering 18 months ago that our run rate would be in the $7 million to $9 million range, average $8 million over the three year period, so that we would end 2020. We would get to the end of 2020 with sufficient cash to continue either the money that we raised in '17 would take us through the end of '20. And that's what our current expectation is, that's what our current estimates and internal budget suggests. So nothing has changed in terms of what we expect to spend. I mean we have the $600,000 of additional site expense, but I think we've come in probably under our expenses this year so when we look at the total spend over the three year period we're on track.

Per Ostlund -- Analyst

Very good. Thank you.

Operator

And it does look like we have any further questions at this time. (Operator Instructions)

Brian Sullivan -- Chief Executive Officer and Co-Founder

Okay. Well, it looks like no more questions, I'd like to thank everyone for participating and look forward to catching up with you later. Good-bye.

Operator

This does conclude today's program. Thank you for your participation. You may disconnect at any time.

Duration: 28 minutes

Call participants:

Brian Sullivan -- Chief Executive Officer and Co-Founder

Vicky Hahne -- Chief Financial Officer

Edward Marks -- H.C. Wainwright -- Analyst

Per Ostlund -- Analyst

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  Sciple: That will be our first look at how any of these companies was affected by the shutdown. We had a lot of defense contractors reporting earnings in this past week. Lockheed Martin (NYSE:LMT), General Dynamics (NYSE:GD), Raytheon (NYSE:RTN), Northrop (NYSE:NOC). Of course, those numbers are not embracing a significant chunk of the government shutdown. However, they did give relatively muted guidance looking out into next year. Can you talk about that a little bit? 

• [By ]

  In addition to increasing the dividend, Action Alerts PLUS holding Raytheon announced in late March that under the Department of Defense's DARPA program, it was developing technology that could control swarms of both air-based, and ground-based drone vehicles that might be launched using a "drag and drop" visual interface. My price target: $245.

  General Dynamics (GD)

  This is one firm where we have already seen cash flows and margins improving. GD is also another defense name that increased their dividend in March. Think the Navy gets some love in the 2018 federal budget that earmarked $654 billion for the Pentagon? Me too. Know who runs the Virginia class submarine program? General Dynamics. In fact, the Navy just awarded a $696 million modification to that program for 2019.

Top 5 Cheap Stocks To Invest In Right Now: Kohl's Corporation(KSS)

Advisors' Opinion:

• [By Joe Tenebruso]

  But with the prices of many retailers down sharply in recent years, could there be some interesting bargains for investors? In this regard, let's take a look at Kohl's (NYSE:KSS) and J.C. Penney (NYSE:JCP) to see which of these retailers is the better buy today.

• [By Leo Sun]

  Macy's slightly reduced its inventory year over year, and its gross margin rose 80 basis points year over year to 40.4%. That's a much higher gross margin that what peers like J.C. Penney (NYSE:JCP) and Kohl's (NYSE:KSS) have achieved recently.

• [By Daniel B. Kline]

  Kohl's (NYSE:KSS) has proven to be one of the retail companies that understand how to operate in a changing market. The company, which at one point looked like it would fall victim to the so-called retail apocalypse, has posted some strong results recently.

• [By Lisa Levin]

  Some of the stocks that may grab investor focus today are:

  Wall Street expects Advance Auto Parts, Inc. (NYSE: AAP) to report quarterly earnings at $1.97 per share on revenue of $2.91 billion before the opening bell. Advance Auto Parts shares gained 0.06 percent to $119.22 in after-hours trading. Analysts expect Hewlett Packard Enterprise Company (NYSE: HPE) to post quarterly earnings at $0.31 per share on revenue of $7.38 billion after the closing bell. Hewlett Packard Enterprise shares gained 0.46 percent to $17.59 in after-hours trading. Before the opening bell, TJX Companies Inc (NYSE: TJX) is estimated to report quarterly earnings at $1.02 per share on revenue of $8.47 billion. TJX shares rose 0.35 percent to $85.00 in after-hours trading. Micron Technology, Inc. (NASDAQ: MU) reported a $10 billion buyback plan. Micron shares gained 3.46 percent to $57.40 in the after-hours trading session. Analysts are expecting Kohl's Corporation (NYSE: KSS) to have earned $0.5 per share on revenue of $3.95 billion in the latest quarter. Kohl's will release earnings before the markets open. Kohl's shares fell 0.60 percent to $65.08 in after-hours trading.

  Find out what's going on in today's market and bring any questions you have to Benzinga's PreMarket Prep.

• [By Chris Lange]

  Kohl's Corp. (NYSE: KSS) will share its latest quarterly earnings on Tuesday. The consensus estimates call for $0.50 in EPS and $3.95 billion in revenue. Shares ended last week at $63.67, in a 52-week range of $35.16 to $69.48. The consensus analyst target is $69.76.

3 Stocks the World's Best Investors Are Buying Right Now

Sticking to a long-term investing strategy is simple, but not easy. It usually requires years of experience to learn how to suppress emotions (as best as possible) and not follow the whims of the crowd. When a stock collapses on one bad earnings report, perhaps that's a screaming opportunity to start or add to a position. Similarly, when a stock shoots up irrationally, it may be a good time to take some profits off the table.

Given the emotional component of money -- especially your money -- investors can boost their confidence a little by taking a peek every once in a while at what the best investors in the world are buying and selling. We recently asked three contributors at The Motley Fool for their picks of the best stocks being added to the most successful funds right now. Here's why they chose Codexis (NASDAQ:CDXS), International Paper (NYSE:IP), and General Motors (NYSE:GM).

Image source: Getty Images.

Tiny enzymes are big business

Maxx Chatsko (Codexis): After adding to existing positions in recent months, BlackRock and Vanguard Group now combine to own about 11% of Codexis. The small-cap biotech company has a low-profile niche engineering enzymes for various applications. Enzymes are complex molecules used by living things to carry out essential processes such as replicating cells, removing wastes from tissues, and harvesting energy from the environment. Essentially, enzymes work by speeding up chemical reactions -- and that utility holds true in industrial processes, too. 

Codexis wields a technology platform allowing it to rapidly engineer enzymes for a wide range of industries and applications. For instance, it supplies products to some of the world's largest pharmaceutical companies, helping them to manufacture drugs more efficiently, and to Tate & Lyle, helping it to make a zero-calorie sweetener ingredient for food and beverage applications. It's also developing enzymes with Nestle Health Science -- the first of which just got picked up by that partner -- that could become therapeutic medicines for rare diseases.

This year, the biotech will also begin market-testing novel diagnostic products powered by its enzymes that can be used in conjunction with DNA sequencing machines. On top of all that, Codexis also licenses its software platform to several core customers, such as pharmaceutical giant Merck, for eight-figure sums.

Codexis is by no means the largest enzyme engineering company in the world, but the business has finally turned a corner. Continued execution on the wealth of high-margin opportunities it has available could allow the small-cap biotech to deliver its first quarterly operating income in late 2019. That momentum has powered shares to a three-year gain of 440%, although at a market cap of just $1.2 billion and no shortage of growth potential, individual investors may want to start a position in this under-the-radar business.

Image source: Getty Images.

What the world's largest hedge fund's betting on

Neha Chamaria (International Paper): As the founder of the world's largest hedge fund, Bridgewater Associates, Ray Dalio is among the most successful investors in the world. Proof of Dalio's success, in fact, lies in the fund's consistently strong performance: He earned nearly $8.1 billion in profit in 2018, making Bridgewater Associates the best-performing hedge fund in the U.S. for the year. The fund currently manages assets worth nearly $124.7 billion.

Dalio's stock moves, therefore, are closely followed by investors. And one of his recent buys that caught my attention was International Paper. It was among Dalio's top five stock additions in the quarter ended Dec. 31, 2018, as Bridgewater bought 1,311,306 shares in the paper and packaging company for an estimated average price of $45.85 per share.

Dalio perhaps saw value in International Paper after its stock fell nearly 26% since the beginning of 2018 through mid-October. Part of Wall Street's pessimism stemmed from the ongoing trade war between the U.S. and China. Fears of tariffs hitting exports of raw material and finished paper products to China -- a key consuming nation -- loomed large.

International Paper, however, eased those fears when it delivered strong numbers for its fourth quarter and fiscal year 2018 in January, reporting impressive growth in operating profits from all its segments.

Two numbers stand out from the company's outlook for 2019: projected free cash flows worth $2 billion, of which $500 million should go toward debt reduction, with the rest returned to shareholders in share repurchases and dividends. Last year, International Paper increased its dividend by 5.3%. With a solid 4.3% dividend yield to boot, the company seems to have made it into Dalio's portfolio for valid reasons.

Image source: Getty Images.

Buffett's bet on GM

Chris Neiger (GM): Warren Buffett, the CEO of Berkshire Hathaway and one of the world's best investors, has added General Motors' stock to his company's portfolio many times. Berkshire's most recent purchase came at the end of 2018 when it bought 19.8 million shares of the automotive giant.

There are a couple of reasons Buffett may be bullish on GM. The first is that the company's shares are trading at just six times forward earnings right now. Aside from GM's shares being relatively inexpensive, the automaker's strong dividend yield of 3.8% is also enticing for many investors.

The second reason for GM's lure right now is its focus on positioning itself for a rapidly changing automotive market. Just a few months ago, the company announced it was restructuring to focus more attention on building electric and autonomous vehicles. That decision comes as annual global autonomous vehicle (AV) sales are expected to surpass 33 million in 2040.

That may seem like a long time away, but GM is working on building that future now. The company's Cruise Automation subsidiary is working on mass-producing a fully self-driving car this year and is expected to launch its own AV ridesharing service this year as well. If that seems premature, consider that Alphabet's Waymo already has a commercial AV ridesharing service running in one city, with plans to expand later this year.

With GM already fast-tracking what it believes will be the future of the automotive industry and the company trading at a discount right now, it's no wonder Buffett is bullish about this automotive giant.

Top 5 Clean Energy Stocks To Own For 2019

tags:TEF,CHKP,MTCH,ALDR,TWTR,

Freshman Congress member Alexandria Ocasio-Cortez and veteran lawmaker Sen. Edward Markey are introducing a resolution spelling out congressional support for a Green New Deal — an ambitious plan to remake the U.S. economy and drastically reduce the nation's greenhouse gas emissions.

The resolution largely sticks to a blueprint Ocasio-Cortez laid out when she proposed creating a House select committee to establish a Green New Deal. That framework called for generating 100 percent of the nation's power from renewable sources, making all buildings energy efficient and eliminating carbon dioxide and other greenhouse gas emissions from the transportation sector and industry — all within about 10 years.

The plan also proposes massive investments in research and development to make the U.S. a leader in clean energy technology. In addition, the Green New Deal envisioned by Ocasio-Cortez aims to implement progressive policies such as a federal jobs guarantee, basic income and universal health care.

Top 5 Clean Energy Stocks To Own For 2019: Telefonica SA(TEF)

Advisors' Opinion:

• [By Shane Hupp]

  UBS Group set a €10.00 ($11.76) price target on Telefonica (BME:TEF) in a report published on Wednesday morning, www.boersen-zeitung.de reports. The brokerage currently has a buy rating on the stock.

• [By Logan Wallace]

  Telefonica (NYSE:TEF) and TELE2 AB/ADR (OTCMKTS:TLTZY) are both utilities companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, earnings, profitability, institutional ownership, dividends, analyst recommendations and valuation.

• [By Ethan Ryder]

  Telefonica (BME:TEF) has been assigned a €10.70 ($12.44) target price by Deutsche Bank in a research note issued on Tuesday. The brokerage presently has a “buy” rating on the stock. Deutsche Bank’s target price would suggest a potential upside of 30.49% from the company’s previous close.

Top 5 Clean Energy Stocks To Own For 2019: Check Point Software Technologies Ltd.(CHKP)

Advisors' Opinion:

• [By Chris Neiger]

  Shares of IT security company Check Point Software Technologies (NASDAQ:CHKP) jumped by 15.3% in July, according to data provided by S&P Global Market Intelligence, after the company received a buy rating from a BTIG analyst and as the company reported solid earnings in its second quarter that surpassed some of management's own expectations.

• [By ]

  Check Point Software Technologies (Nasdaq: CHKP) plummeted 6.4% when it only slightly beat Q1 expectations but guided lower for the year. Cybersecurity has gotten more competitive recently, and the company reported a 12% increase in marketing expenses through the first quarter. That spooked investors on the potential for slower sales growth and weaker profitability.

• [By Chris Lange]

  Check Point Software Technologies Ltd.'s (NASDAQ: CHKP) short interest increased to 11.56 million shares from the previous reading of 10.59 million. Shares were trading at $97.55, in a 52-week range of $93.76 to $119.20.

• [By Ethan Ryder]

  Get a free copy of the Zacks research report on Check Point Software Technologies (CHKP)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

Top 5 Clean Energy Stocks To Own For 2019: Match Group, Inc.(MTCH)

Advisors' Opinion:

• [By Leo Sun]

  When investors think of "social networking" stocks, they generally focus on Facebook (NASDAQ:FB), Twitter, and Snap. However, they often overlook Match Group (NASDAQ:MTCH), which owns Match, Tinder, OKCupid, Plenty of Fish, and other popular dating apps.

• [By Joe Tenebruso]

  Match Group (NASDAQ:MTCH) CEO Amanda Ginsberg highlighted some key aspects of the dating products company's growth strategy during its second-quarter earnings call on Aug. 8. Here are the major points investors will want to know.

• [By Chris Lange]

  Match Group Inc. (NASDAQ: MTCH) is scheduled to release its most recent quarterly results after the markets close on Tuesday. The consensus estimates from Thomson Reuters are $0.23 in earnings per share (EPS) on $384.98 million in revenue. The first quarter of last year reportedly had $0.12 in EPS on $298.76 million in revenue.

• [By Stephan Byrd]

  ValuEngine upgraded shares of Match Group (NASDAQ:MTCH) from a hold rating to a buy rating in a research report sent to investors on Wednesday.

  A number of other research firms have also recently issued reports on MTCH. UBS Group upgraded shares of Match Group from a neutral rating to a buy rating in a research report on Thursday, May 10th. BidaskClub upgraded shares of Match Group from a buy rating to a strong-buy rating in a research report on Saturday, May 12th. Evercore ISI restated an in-line rating and issued a $34.00 price objective on shares of Match Group in a research report on Wednesday, May 2nd. Deutsche Bank boosted their price objective on shares of Match Group to $43.00 and gave the company a buy rating in a research report on Friday, May 11th. Finally, BMO Capital Markets decreased their price objective on shares of Match Group to $45.00 and set an outperform rating on the stock in a research report on Thursday, May 10th. Ten research analysts have rated the stock with a hold rating, ten have issued a buy rating and one has assigned a strong buy rating to the company’s stock. Match Group presently has a consensus rating of Buy and an average price target of $42.01.

• [By Chris Lange]

  Match Group Inc. (NASDAQ: MTCH) saw its short interest fall to 27.85 million from the previous 29.16 million. Shares were trading at $45.26, in a 52-week range of $16.57 to $48.65.

Top 5 Clean Energy Stocks To Own For 2019: Alder BioPharmaceuticals, Inc.(ALDR)

Advisors' Opinion:

• [By Ethan Ryder]

  Alder Biopharmaceuticals (NASDAQ:ALDR) was upgraded by BidaskClub from a “hold” rating to a “buy” rating in a research report issued on Monday.

• [By Ethan Ryder]

  Needham & Company LLC assumed coverage on shares of Alder Biopharmaceuticals (NASDAQ:ALDR) in a report issued on Wednesday. The brokerage issued a buy rating and a $28.00 price objective on the biopharmaceutical company’s stock.

• [By Stephan Byrd]

  BidaskClub cut shares of Alder Biopharmaceuticals (NASDAQ:ALDR) from a strong-buy rating to a buy rating in a report released on Tuesday.

  A number of other equities research analysts have also weighed in on the company. Goldman Sachs Group initiated coverage on Alder Biopharmaceuticals in a research report on Tuesday, April 24th. They set a neutral rating and a $17.00 price objective on the stock. Mizuho restated a buy rating and set a $29.00 price objective on shares of Alder Biopharmaceuticals in a research report on Wednesday, March 28th. Cowen set a $23.00 price target on Alder Biopharmaceuticals and gave the company a buy rating in a research report on Monday, February 26th. Leerink Swann reiterated an outperform rating on shares of Alder Biopharmaceuticals in a research report on Sunday, March 4th. Finally, Zacks Investment Research lowered Alder Biopharmaceuticals from a hold rating to a sell rating in a research report on Tuesday, May 1st. One analyst has rated the stock with a sell rating, three have given a hold rating and eleven have issued a buy rating to the company. Alder Biopharmaceuticals currently has an average rating of Buy and a consensus target price of $26.33.

Top 5 Clean Energy Stocks To Own For 2019: Twitter, Inc.(TWTR)

Advisors' Opinion:

• [By ]

  And yet, Yahoo isn't alone. There are plenty of companies struggling to articulate and employ an actionable business plan. One such company is Twitter (NYSE: TWTR). The company has been operating for years with no discernible ability to fully monetize its business. 

• [By Garrett Baldwin]

  Well, Money Morning Special Situation Strategist Tim Melvin has broken these secrets out of the vault of the Smart Money managers. And he's sharing the Max Wealth secrets for free, right here.

  Stocks to Watch Today: TWTR, GPRO, CMG Social media giant Twitter Inc. (NYSE: TWTR) leads a busy day of earnings reports. Shares fell 7.5% after the firm issued weaker-than-expected guidance. The company said its expenses would increase by 20% in 2019. Throughout the day, we'll be looking at the firm's performance in attracting younger Americans to utilize the platform. The firm did beat analysts' projections for quarterly revenue (reporting $909 million). Its $0.31 per share in profits beat expectations $0.25 per share. Follow topicMorning Market Alert

  Get an exclusive look at what's going on in the markets at the start of each day.

• [By Garrett Baldwin]

  After a rise in scam accounts, Twitter Inc. (NYSE: TWTR) says it will take steps to reduce the amount of cryptocurrency scammers on its site, according to The Verge.

Centrica (CNA) Downgraded to Hold at Berenberg Bank

Berenberg Bank cut shares of Centrica (LON:CNA) to a hold rating in a research note issued to investors on Monday. Berenberg Bank currently has GBX 140 ($1.83) price target on the integrated energy company’s stock, down from their prior price target of GBX 155 ($2.03).

Several other equities analysts have also recently weighed in on the stock. Morgan Stanley reaffirmed an underweight rating and set a GBX 105 ($1.37) target price on shares of Centrica in a research note on Thursday, January 17th. Credit Suisse Group reaffirmed an outperform rating and issued a GBX 180 ($2.35) price objective on shares of Centrica in a report on Monday, October 29th. UBS Group downgraded shares of Centrica to a neutral rating and dropped their price objective for the company from GBX 165 ($2.16) to GBX 135 ($1.76) in a report on Wednesday, December 5th. Deutsche Bank dropped their price objective on shares of Centrica from GBX 135 ($1.76) to GBX 115 ($1.50) and set a sell rating on the stock in a report on Monday, December 10th. Finally, Jefferies Financial Group downgraded shares of Centrica to a hold rating and dropped their price objective for the company from GBX 170 ($2.22) to GBX 125 ($1.63) in a report on Monday, January 7th. Four equities research analysts have rated the stock with a sell rating, five have issued a hold rating and three have given a buy rating to the company. Centrica presently has an average rating of Hold and an average price target of GBX 139.92 ($1.83).

Get Centrica alerts:

CNA opened at GBX 137.20 ($1.79) on Monday. Centrica has a fifty-two week low of GBX 119.71 ($1.56) and a fifty-two week high of GBX 221 ($2.89).

In other news, insider Margherita D. Valle sold 1,492 shares of the company’s stock in a transaction on Monday, November 26th. The shares were sold at an average price of GBX 133 ($1.74), for a total value of £1,984.36 ($2,592.92).

About Centrica

Centrica plc operates as an integrated energy company in the United Kingdom, the Republic of Ireland, Germany, Norway, rest of Europe, the United States, Canada, and internationally. The company operates through Centrica Consumer, Centrica Business, Exploration & Production, and Centrica Storage segments.

Further Reading: Stop Order

Hot Penny Stocks For 2019

tags:UMH,EGLE,BDSI,ATAX,

Evine Live (NASDAQ:EVLV) is the third biggest TV shopping network in the U.S. behind QVC and HSN, which recently merged under the Qurate Retail Group brand name. However, in our view, Evine holds the greatest potential for share price appreciation.

Last week, the company reported Q1 2018 revenue revenue of $156.5M that topped analysts' expectations, with revenue growth of 1.2% YoY, the second consecutive quarter of positive revenue growth following seven quarters of negative revenue growth. Contrast that with HSN, whose revenue declined 10% YoY in Q1 2018, and QVC U.S., when adjusted for accounting changes, grew revenue between 1.5%-2%. Adjusted EBITDA of $3.3M was also above analysts' expectations. Full-year guidance was reiterated with revenue of 2-5% YoY on a normalized basis, or 0-3% YoY due to the extra 53rd week in fiscal 2018, and adjusted EBITDA of $19-21M (+5-17% YoY). Adjusted EPS loss of $0.03 did come in 1 penny below consensus due to management transition costs.

Revenue growth should continue to benefit from a resurgence of growth in categories such as Beauty and Wellness and Home and Consumer Electronics, and aided by the addition of 10M HD households toward the end of last year, which should drive an increase in revenue per household. New brand launches (13 launched in the quarter), product refreshes, and continued merchandising mix rebalancing should help the revenue trajectory as well.

Hot Penny Stocks For 2019: UMH Properties Inc.(UMH)

Advisors' Opinion:

• [By Max Byerly]

  Get a free copy of the Zacks research report on UMH PROPERTIES/SH SH (UMH)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Joseph Griffin]

  WINTON GROUP Ltd bought a new stake in UMH PROPERTIES/SH SH (NYSE:UMH) during the first quarter, according to the company in its most recent filing with the Securities and Exchange Commission (SEC). The fund bought 86,705 shares of the real estate investment trust’s stock, valued at approximately $1,163,000. WINTON GROUP Ltd owned about 0.24% of UMH PROPERTIES/SH SH as of its most recent SEC filing.

• [By Lisa Levin]

  Wednesday afternoon, the real estate shares surged 0.56 percent. Meanwhile, top gainers in the sector included Armada Hoffler Properties, Inc. (NYSE: AHH), up 3 percent, and UMH Properties, Inc. (NYSE: UMH) up 3 percent.

• [By Max Byerly]

  Get a free copy of the Zacks research report on UMH PROPERTIES/SH SH (UMH)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

Hot Penny Stocks For 2019: Eagle Bulk Shipping Inc.(EGLE)

Advisors' Opinion:

• [By Joseph Griffin]

  Eagle Bulk Shipping Inc. (NASDAQ:EGLE) major shareholder Goldentree Asset Management Lp acquired 84,969 shares of the business’s stock in a transaction on Monday, February 11th. The shares were bought at an average cost of $4.02 per share, for a total transaction of $341,575.38. The acquisition was disclosed in a legal filing with the SEC, which is available at this link. Large shareholders that own at least 10% of a company’s shares are required to disclose their transactions with the SEC.

• [By Stephan Byrd]

  Several brokerages have updated their recommendations and price targets on shares of Eagle Bulk Shipping (NASDAQ: EGLE) in the last few weeks:

  7/2/2018 – Eagle Bulk Shipping was downgraded by analysts at ValuEngine from a “hold” rating to a “sell” rating. 6/28/2018 – Eagle Bulk Shipping was downgraded by analysts at BidaskClub from a “buy” rating to a “hold” rating. 6/18/2018 – Eagle Bulk Shipping is now covered by analysts at Morgan Stanley. They set an “equal weight” rating and a $6.50 price target on the stock. 6/18/2018 – Eagle Bulk Shipping is now covered by analysts at DNB Markets. They set a “buy” rating on the stock. 6/12/2018 – Eagle Bulk Shipping was downgraded by analysts at BidaskClub from a “buy” rating to a “hold” rating. 6/2/2018 – Eagle Bulk Shipping was upgraded by analysts at BidaskClub from a “hold” rating to a “buy” rating. 6/2/2018 – Eagle Bulk Shipping was upgraded by analysts at ValuEngine from a “hold” rating to a “buy” rating. 5/29/2018 – Eagle Bulk Shipping is now covered by analysts at Evercore ISI. They set an “outperform” rating and a $7.50 price target on the stock. 5/15/2018 – Eagle Bulk Shipping was upgraded by analysts at Zacks Investment Research from a “sell” rating to a “hold” rating. According to Zacks, “Eagle Bulk Shipping is the largest U.S. based owner of Handymax dry bulk vessels. Handymax dry bulk vessels range in size from 35,000 to 60,000 deadweight tons, or dwt, and transport a broad range of major and minor bulk cargoes, including iron ore, coal, grain, cement and fertilizer, along worldwide shipping routes. “ 5/9/2018 – Eagle Bulk Shipping had its “hold” rating reaffirmed by analysts at Maxim Group. They now have a $6.00 price target on the

Hot Penny Stocks For 2019: BioDelivery Sciences International Inc.(BDSI)

Advisors' Opinion:

• [By Lisa Levin] Gainers Comstock Holding Companies, Inc. (NASDAQ: CHCI) shares climbed 154.95 percent to close at $5.15 on Thursday. Comstock reported conversion of the majority of its unsecured, short-term debt into non-convertible preferred equity. Tyme Technologies, Inc. (NASDAQ: TYME) jumped 33.45 percent to close at $3.87. Universal Corporation (NYSE: UVV) gained 29.72 percent to close at $62.85 after reporting fiscal Q4 results. Evolus, Inc. (NASDAQ: EOLS) shares rose 22.93 percent to close at $23.80. nLIGHT, Inc. (NASDAQ: LASR) jumped 21.52 percent to close at $36.37 following Q1 results. Hudson Technologies Inc. (NASDAQ: HDSN) gained 20.28 percent to close at $2.61. The Cato Corporation (NYSE: CATO) shares rose 19.57 percent to close at $21.45 after the company posted better-than-expected first-quarter results. AXT, Inc. (NASDAQ: AXTI) gained 18.8 percent to close at $7.90. Catasys, Inc. (NASDAQ: CATS) rose 16.33 percent to close at $6.41. HUYA Inc. (NYSE: HUYA) rose 15.68 percent to close at $23.09 on Thursday. Marinus Pharmaceuticals, Inc. (NASDAQ: MRNS) climbed 15.11 percent to close at $6.02 on Thursday after gaining 6.30 percent on Wednesday. Baird initiated coverage on Marinus Pharmaceuticals with an Outperform rating. Destination Maternity Corporation (NASDAQ: DEST) shares rose 14.48 percent to close at $3.32 after the board announced late Wednesday the election of four activist-backed director nominees. Three women and one man comprise the selected group championed by NGM Capital’s Nathan Miller and Kenosis Capital’s Peter O’Malley. Destination Maternity had advocated for another slate of three men and interim CEO Melissa Payner-Gregor. The new directors are Holly Alden, Marla Ryan, Anne-Charlotte Windal and Christopher Morgan. China Rapid Finance Limited (NYSE: XRF) gained 11.53 percent to close at $3.29 after announcing preliminary Q1 results. Bilibili Inc.. (NASDAQ: BILI) shares rose 11.33 pe
• [By Joseph Griffin]

  BioDelivery Sciences International, Inc. (NASDAQ:BDSI) Director Francis E. Odonnell, Jr. sold 8,000 shares of the firm’s stock in a transaction on Friday, February 1st. The stock was sold at an average price of $4.60, for a total value of $36,800.00. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this hyperlink.

• [By Stephan Byrd]

  Media headlines about BioDelivery Sciences International (NASDAQ:BDSI) have been trending somewhat positive recently, according to Accern Sentiment. The research firm identifies positive and negative media coverage by reviewing more than 20 million blog and news sources in real-time. Accern ranks coverage of companies on a scale of negative one to one, with scores closest to one being the most favorable. BioDelivery Sciences International earned a news sentiment score of 0.16 on Accern’s scale. Accern also assigned media headlines about the specialty pharmaceutical company an impact score of 46.960149735727 out of 100, meaning that recent media coverage is somewhat unlikely to have an impact on the company’s share price in the next few days.

• [By Lisa Levin]

  BioDelivery Sciences International, Inc. (NASDAQ: BDSI) shares were also up, gaining 19 percent to $2.3272 after the company announced board restructuring plan and $50m equity financing deal led by Broadfin to "significantly strengthen" financial position.

• [By Logan Wallace]

  BioDelivery Sciences International (NASDAQ:BDSI) had its target price reduced by research analysts at HC Wainwright from $4.00 to $3.50 in a research report issued to clients and investors on Wednesday. The brokerage currently has a “buy” rating on the specialty pharmaceutical company’s stock. HC Wainwright’s price objective points to a potential upside of 40.00% from the company’s current price.

Hot Penny Stocks For 2019: America First Tax Exempt Investors L.P.(ATAX)

Advisors' Opinion:

• [By Motley Fool Transcribers]

  America First Multifamily Investors LP (NASDAQ:ATAX)Q2 2018 Earnings Conference CallAug. 13, 2018, 4:30 p.m. ET

  Contents: Prepared Remarks Questions and Answers Call Participants Prepared Remarks:

  Operator

• [By Shane Hupp]

  America First Multifamily Investors LP (NASDAQ:ATAX) Director Lisa Y. Roskens bought 5,965 shares of the stock in a transaction that occurred on Monday, August 27th. The shares were purchased at an average price of $5.95 per share, for a total transaction of $35,491.75. Following the purchase, the director now owns 100,069 shares in the company, valued at approximately $595,410.55. The acquisition was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link.

• [By Stephan Byrd]

  BidaskClub upgraded shares of America First Multifamily Investors (NASDAQ:ATAX) from a strong sell rating to a sell rating in a research report sent to investors on Thursday morning.

• [By Shane Hupp]

  Shares of America First Tax Exempt Investors, L.P. (NASDAQ:ATAX) hit a new 52-week high and low during mid-day trading on Monday . The company traded as low as $6.47 and last traded at $6.43, with a volume of 54800 shares changing hands. The stock had previously closed at $6.43.

What to Expect When CVS Reports Wednesday

CVS Health Corp. (NYSE: CVS) is scheduled to release its fourth-quarter financial results before the markets open on Wednesday. The consensus estimates from Thomson Reuters are calling for $2.05 in earnings per share (EPS) and $54.58 billion in revenue. The same period of last year reportedly had $1.92 in EPS and $48.38 billion in revenue.

In mid-January, CVS announced that it will be parting ways with megastore Walmart. Specifically, Walmart has opted to leave the CVS Caremark pharmacy benefit management commercial and Managed Medicaid retail pharmacy networks.

Ultimately this came down to a price dispute, but what else is new in how Walmart deals with its business partners.

Note that this transition does not impact Walmart's participation in the CVS Caremark Medicare Part D pharmacy network. Additionally, Walmart's Sam's Club division remains in the CVS Caremark pharmacy networks.

Walmart's termination from the CVS Caremark commercial and Managed Medicaid retail pharmacy networks is not expected to have a material impact on the financial results of CVS in 2019. Currently, less than 5% of affected CVS Caremark members use Walmart exclusively to fill their prescriptions.

Overall, CVS has underperformed the broad markets with its stock up only 6% year to date. In the past 52 weeks, the stock is actually flat.

A few analysts weighed in on CVS ahead of the report:

UBS Group has a Buy rating with a $75 price target. Cantor Fitzgerald has a Buy rating and a $96 price target. Merrill Lynch has a Buy rating with a $92 price target. Barclays has an Overweight rating with a $91 target. Leerink Swann has an Outperform rating. Goldman Sachs has a Neutral rating and an $87 target.

Shares of CVS were last seen trading at $69.81, in a 52-week range of $60.14 to $82.15. The stock has a consensus price target of $88.57.

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AICHAIN Price Down 0.7% Over Last Week (AIT)

AICHAIN (CURRENCY:AIT) traded down 1.9% against the U.S. dollar during the twenty-four hour period ending at 15:00 PM Eastern on February 16th. One AICHAIN token can now be purchased for $0.0008 or 0.00000021 BTC on major cryptocurrency exchanges including Allcoin, OTCBTC, BigONE and DEx.top. AICHAIN has a total market capitalization of $410,230.00 and $21,335.00 worth of AICHAIN was traded on exchanges in the last 24 hours. During the last seven days, AICHAIN has traded down 0.7% against the U.S. dollar.

Here is how other cryptocurrencies have performed during the last 24 hours:

Get AICHAIN alerts: XRP (XRP) traded 0.8% higher against the dollar and now trades at $0.30 or 0.00008319 BTC. Tether (USDT) traded down 0.3% against the dollar and now trades at $1.00 or 0.00027553 BTC. TRON (TRX) traded down 0.2% against the dollar and now trades at $0.0241 or 0.00000660 BTC. Stellar (XLM) traded 1.2% lower against the dollar and now trades at $0.0781 or 0.00002146 BTC. Binance Coin (BNB) traded 0.8% lower against the dollar and now trades at $9.16 or 0.00251464 BTC. Bitcoin SV (BSV) traded up 0.4% against the dollar and now trades at $62.42 or 0.01713694 BTC. IOTA (MIOTA) traded 0.6% higher against the dollar and now trades at $0.27 or 0.00007545 BTC. NEO (NEO) traded 0.7% lower against the dollar and now trades at $8.08 or 0.00221713 BTC. Maker (MKR) traded up 1.6% against the dollar and now trades at $505.95 or 0.13891028 BTC. IOStoken (IOST) traded 0.3% lower against the dollar and now trades at $0.0396 or 0.00000526 BTC.

About AICHAIN

AICHAIN is a token. It was first traded on January 5th, 2018. AICHAIN’s total supply is 2,100,000,000 tokens and its circulating supply is 535,067,071 tokens. The official website for AICHAIN is www.aichain.me. AICHAIN’s official Twitter account is @AICHAIN1 and its Facebook page is accessible here.

AICHAIN Token Trading

AICHAIN can be traded on the following cryptocurrency exchanges: Coinsuper, FCoin, DEx.top, BCEX, OTCBTC, CoinEgg, BigONE, CoinBene and Allcoin. It is usually not currently possible to purchase alternative cryptocurrencies such as AICHAIN directly using U.S. dollars. Investors seeking to acquire AICHAIN should first purchase Ethereum or Bitcoin using an exchange that deals in U.S. dollars such as Changelly, Coinbase or Gemini. Investors can then use their newly-acquired Ethereum or Bitcoin to purchase AICHAIN using one of the aforementioned exchanges.

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Twitter Management Talks Video, Daily Users, and More

Twitter (NYSE:TWTR) demonstrated more strong momentum in its fourth quarter, reporting strong top- and bottom-line growth and a nice uptick in daily users. Specifically, revenue increased 24% year over year to a record $909 million, and net income surged from $91 million in the year-ago quarter to $255 million. Meanwhile, the company's monetizable daily active users grew 9% year over year.

But what's behind this growth? Further, what does management think about Twitter's prospects going forward? To get a better understanding of the dynamics driving Twitter's business and management's view of its business, investors can turn to the company's most recent earnings call.

During the call, management discussed a range of topics. Here are three key quotes, including a look at a major catalyst for the company, a product change management is excited about, and how to think about daily active user growth.

Image source: Getty Images.

Video ads: A major catalyst for Twitter

The video ad format has been a major driver for digital advertising across social networks, including Facebook, Snapchat, and YouTube. Twitter is no exception to this trend.

Twitter CFO Ned Segal explained:

The video website card and the video app card continue to bring incremental dollars to Twitter as well as replacing where dollars might have been going before with a more compelling format and hopefully delivered in a more relevant way to a growing and more engaged audience. As a result of those is that we get better click-through rates. Click-through rates were up 27% this quarter.

The importance of video ads to Twitter can't be overstated. Not only is it the company's fastest-growing ad format, but video accounted for over half of the company's revenue during both the fourth quarter and the full year of 2018. 

Improving conversations

When asked about upcoming product changes he's most excited about, Twitter CEO Jack Dorsey named three areas on the consumer side of the social network: platform health improvements, making conversations more fluid, and making it easier for users to follow their interests.

The company's plans to improve conversations sounded particularly exciting.

"We believe [conversation] is our core differentiator," Dorsey explained. "People come to Twitter not only to see what's happening, but what people think about what's happening, what people are talking about."

Dorsey expects there's significant room for improvement in this area:

And right now, the experience of having a conversation on Twitter is pretty difficult. There's a lot of friction within it. It's very hard to follow conversations. It's very hard to participate in them. We think there's a ton of opportunity to make that much, much faster. And we believe that this will generate even more conversations.

Expect more growth in monetizable daily active users

Twitter's growth in daily active users, or monetizable daily active users (mDAU), as the company now calls them, has been encouraging recently. Twitter's daily active users increased from 115 million at the end of 2017 to 126 million at the end of 2018. Given that monthly active users decreased from 330 million to 321 million over the same time frame, this highlights a sharp increase in user engagement on the platform.

But can Twitter keep growing its MDAU? When asked about what to expect from the metric, Segal sounded optimistic: "On mDAU growth and how it might evolve over the course of the year, we're not going to guide to how mDAU is going to grow. But we do think that the product changes that Jack has talked about and the events that go on in the world at any given time, they ought to cause DAU to continue to grow."

Of course, a closer look at Twitter's mDAU growth helps support the case for more strong growth in the metric. Growth in mDAU has been broad based across geographies, with five out of 10 of Twitter's top global markets seeing double-digit year-over-year growth in the key metric in Q4.

 

Customer Woes Weigh on XPO Logistics

The holiday season is typically a busy one for XPO Logistics (NYSE:XPO). With the rise of e-commerce, it's more important than ever to have efficient ways of getting goods where they need to go, and XPO has played a key role in helping to facilitate that movement. However, XPO has been dealing with some issues affecting one of its major customers, and that could have long-lasting negative impacts on its growth potential.

Coming into Thursday's fourth-quarter financial report, XPO investors were optimistic that the company would post much better numbers than it did during 2017's holiday quarter. XPO did indeed generate substantial growth, but the results weren't as encouraging as most had hoped, and ongoing troubles show no signs of letting up in the immediate future.

Image source: XPO Logistics.

XPO deals with disappointment

XPO Logistics' fourth-quarter results marked a discouraging end to the year. Sales climbed just 5% to $4.39 billion, which was far slower than the company had posted earlier in 2018, and weaker than the roughly 9% growth that those following the stock had expected. Adjusted net income jumped 66% to $98 million, but the resulting adjusted earnings of $0.72 per share fell well short of the consensus forecast among investors for $0.84 per share on the bottom line.

XPO's segments showed a mix of performance. The logistics segment saw strong sales growth, with overall revenue climbing 10% on organic growth of more than 12%. Rising demand for e-commerce logistics was a primary contributor to performance, as were the packaged goods and food and beverage sectors in North America and the fashion industry in Europe. Operating income was lower for the unit, but adjusted pre-tax earnings climbed 11% from year-earlier levels due to a large number of new contracts that began over the course of the past year.

However, the transportation segment didn't do as well. Revenue was up less than 2% year over year for the segment, with less-than-truckload shipments in North America and Europe leading the way higher. Adjusted pre-tax operating profit growth was similarly minimal, at about 3%, as XPO wasn't able to capitalize as much as investors wanted from improved expense management in keeping the company's operating ratio moving in a more favorable direction.

CEO Brad Jacobs explained the reason for the pressure on the company's most recent results. "We missed our fourth quarter forecast for adjusted EBITDA," Jacobs said, "primarily due to headwinds in France and the U.K. and a loss of profit in the postal injection business with our largest customer." The CEO was still pleased with XPO's full-year results.

Will XPO recover?

XPO doesn't see those headwinds letting up any time soon. In explaining anticipated growth in adjusted pre-tax operating earnings of 6% to 10%, Jacobs said XPO "anticipates the impact of our largest customer substantially downsizing its business portfolio with us starting in the first quarter, as well as our more cautious view of Europe." XPO remains confident about its long-term prospects, but higher interest expense from its stock buyback program could also weigh on free cash flow.

The impact of the customer issue on XPO's guidance for 2019 was substantial. The company sees revenue growing just 3% to 5% for the full year, with organic growth of 4% to 6% getting weighed down slightly by currency impacts and other factors. Similarly, adjusted pre-tax operating earnings should come in between $1.65 billion and $1.725 billion, and while that would represent growth of 6% to 10% from 2018 levels, that's less than the 12% to 15% XPO had previously forecast. Free cash flow could be as much as $125 million less than previously expected, with a new range of $525 million to $625 million.

XPO investors weren't pleased with the news, and the stock plunged 15% in pre-market trading Friday following the Thursday evening announcement. Until investors have more clarity on how the logistics specialist expects to rebound from its troubles, XPO will have trouble mounting a rebound.

Podcast | Stock Picks of the Day: Watch out! Nifty could witness a ‘dead cat bounce’

Hadrien Mendonca

The market continued to struggle as Nifty extended its losing streak on Thursday. The index closed around the 200-DEMA of 10,750 and is now approaching towards the 10,680 levels which is the rising trendline of the Ascending Triangle pattern on the daily chart.

Going forward, a dead cat bounce cannot be ruled out.

related news What changed for the market while you were sleeping? Top 10 things to know A morning walk down Dalal Street | Bounce back looks inevitable, Nifty may rally towards 10,900

A dead cat bounce is a small, temporary recovery in the price of a declining security or index.

Bank Nifty, on the other hand, outperformed Nifty as the index found support around its 100-DEMA. Our weekly chart analysis indicates that Bank Nifty has also not breached below the previous week's low of 26,885 which will now act as a crucial support zone. On the upside, 27,300-27,350 is the stiff resistance for the index.

The smallcap 100 index is precariously poised at triple bottom support levels which were seen in October 2018. If the index manages to hold above the 5,670 levels on a closing basis, a meaningful bounce back is likely in the sector.

Following is a list of three stocks that could deliver up to 6-7% returns:

JSW Steel: Buy| Target: Rs 300| Stop Loss: Rs 270| Upside 7%

The stock has been under pressure in the recent past; however, it has finally managed to breakout from an inverse Head and Shoulder pattern on smaller time frame chart which is an early sign of a reversal.

Our monthly chart analysis indicates that the stock has also found support around the 50% retracement level of the entire rally from August 2015 to all-time highs hit in September 2018.

Tata Global Beverages: Buy| Target: Rs 200| Stop Loss: Rs 183| Upside 6.5%

The stock has been consolidating for the past seven trading sessions and has finally broken out from a falling channel pattern on the daily chart.

Positive crossovers on the Relative Strength Index (RSI) indicates that stock has the potential to carry forward the momentum. Every long position should be protected with a stop loss at Rs 183 on a closing basis.

GAIL India Feb Futs: Sell| Target: Rs 290| Stop Loss: Rs 317| Downside 6%

The stock is weak and has also broken down from a Pennant pattern on the weekly chart. Our daily chart analysis also indicates that GAIL has broken down from a Rectangular pattern indicating further downside on the cards. The stock is likely to slip lower towards its potential target of Rs 290 in the near term.

(The author is Sr Technical Analyst, IIFL)

Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. First Published on Feb 15, 2019 08:31 am

Brightcove Inc (BCOV) Q4 2018 Earnings Conference Call Transcript

Image source: The Motley Fool.

Brightcove Inc  (NASDAQ:BCOV)Q4 2018 Earnings Conference CallFeb. 13, 2019, 5:00 p.m. ET

Contents: Prepared Remarks Questions and Answers Call Participants Prepared Remarks:

Operator

Greetings and welcome to Brightcove's Fourth Quarter and Fiscal Year 2018 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Brian Denyeau.

Brian Denyeau -- Investor Relations

Good afternoon and welcome to Brightcove's fourth quarter and full year 2018 earnings call. Today we'll discuss the results announced in our press release issued after market close. With me on the call are Jeff Ray, Brightcove's Chief Executive Officer; and Rob Noreck, Brightcove's Chief Financial Officer.

During the call we will make statements related to our business that may be considered forward-looking and are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements concerning our financial guidance for the first fiscal quarter of 2019 and the full year 2019, expected profitability and positive free cash flow, our position to execute on our go-to-market and growth strategy, our ability to expand our leadership position, our ability to maintain and upsell existing customers as well as our ability to acquire new customers.

Forward-looking statements may often be identified with words such as we expect, we anticipate, upcoming or similar indications of our future expectations. These statements reflect our views only as of today and should not be reflected upon as representing our views as of any subsequent date. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations. For a discussion of the material risks and other important factors that could affect our actual results, please refer to those contained in our most recently filed annual report on Form 10-K and as updated by our other SEC filings.

Also during the course of today's call we will refer to certain non-GAAP financial measures. There's a reconciliation schedule showing GAAP versus non-GAAP results currently available in our press release issued after market close today, which can be found in our website at www.brightcove.com. In terms of the agenda for today's call, Jeff will provide a summary review of our financial results, an update in our operations and a review of our strategy. Rob will finish with additional details -- regarding our fourth quarter 2018 results as well as our outlook for the first quarter and full year 2019.

With that, let me turn the call over to Jeff.

Jeff Ray -- Chief Executive Officer

Thank you, Brian and thank you all for joining today. During the fourth quarter, Brightcove made additional progress with its strategic initiatives to position the Company to deliver breakout growth. We remain confident that Brightcove can deliver sustainable revenue growth and profitability in excess of current levels over time, as the changes we are making take hold across the business.

A key part of our strategy and what gives me confidence that it will be successful, is the continued improvements in renewal rates we saw throughout 2018 which trended higher throughout the year. We believe this is a clear demonstration that the investments we have made in our products and services are resonating with customers and driving improved business outcomes. We are reestablishing Brightcove as the clear thought leader in the online video platform market. This was recently validated by Gartner Research which placed Brightcove in the Leader Quadrant for Enterprise Video Content Management for the second consecutive report.

Turning to our financial results briefly for the quarter, we delivered fourth quarter revenue of $40.9 million, up 2% year-over-year and slightly below our guidance. Adjusted EBITDA was positive $1.4 million, which was above the high end of our guidance and reflects our commitment to profitable growth. And our recurring dollar retention rate was 104%, well above our historical range. The modest shortfall in revenue was driven by lower than expected services revenue and the second consecutive quarter of lower overage revenue. The impact to services revenue was driven by the timing of completion for a few projects. As it relates to overages, we are seeing fewer customers move into overages at the end of their contracts, including the seasonally strong fourth quarter.

From a bookings perspective, overall our fourth quarter performance reflected many of the same trends we experienced in the third quarter. For the year, bookings were relatively flat as the solid first half was outweighed by weakness in the second half. We are now well into the process of revamping our product and go-to-market efforts to align with our new strategy. In the near-term, we remain dependent on several larger transactions each quarter until we complete this process.

Our goal is to build a higher velocity, predictable selling model that generates many more sales opportunities across every use case and market. We are in a much better position to achieve that goal entering 2019 then when I joined the Company in April. I believe it is an essential component of how Brightcove begins to deliver the financial results the Company is capable of, and that our shareholders expect.

I would like to take a few moments to provide some additional insight into the Company's strategy and the progress we have made to execute it successfully. As we talked about on our last call, we spent a significant amount of time last year, researching our total addressable market. We have finalized our product development roadmap and we'll be bringing a number of new solutions to market in 2019. We are focusing our resources on products that pass a rigorous ROI-based methodology by identifying the greatest customer needs.

This work helped us identify our total addressable market or TAM, which was $1.6 billion in 2016 and growing at a 17% CAGR to $4.2 billion by 2022 per IDC and other estimates. We targeted nine distinct customer end markets that we already serve today in the media, entertainment, marketing and enterprise spaces. This tightly aligns with our historical strength in media and our ability to leverage that strength in adjacent segments. We are initially focusing on four of these segments, which together represent about 60% of the overall TAM and have a faster growth profile.

Let me share some more color on a few of those segments. The marketing and sales segment is expected to be a $900 million market opportunity by 2022 and is growing more than 20% annually. This is a sweet spot for Brightcove, because our position as a trusted cloud provider with deep domain expertise gives us tremendous credibility with customers. We're focused on making it significantly simpler for digital marketers to choose Brightcove and then launch their digital marketing campaign in the field as quickly as possible. To drive this high velocity selling model, our products need to be incredibly simple to use. We have a targeted and detailed product roadmap that we will communicate at PLAY, our annual user conference that takes place in May.

An example of the opportunity in this market was a win we had in the fourth quarter with McCormick and Company, a Fortune 1000 Company that manufactures, markets and distributes spices, seasoning mixes, condiments and other flavorings to the entire food industry. McCormick will use Brightcove to deliver premium video content. That is how-to recipes, to promote brand awareness and customer loyalty across its websites, social channels, branded app and other platforms. As their video library grows, their digital marketing team was looking to create a blended video strategy by leveraging the benefits of YouTube with the brand controls and deep analytics that Brightcove offers to provide an enhanced experience across its own properties.

Two of our other market segments that we will focus more deeply on, are related to OTT experiences. Together, these markets are expected to grow annually by nearly 20% and be more than a $1.1 billion market by 2022. We're seeing a rapid increase in the number of content providers who are looking to directly engage with their customers by providing a compelling OTT experience. This democratization of content is creating new business opportunities for content providers.

To capitalize on it, they needed simple, out-of-the-box OTT solution that doesn't require extensive IT support. We will be announcing a new OTT offering that leverages the early success of our OTT Flow solution this year. A great example of the opportunity in media and OTT is HOOQ, the first premium video-on-demand service to launch in Southeast Asia. HOOQ's ambition is to provide affordable entertainment by bringing the best of local and Hollywood entertainment to anyone, anytime and anywhere. HOOQ selected Brightcove because of our feature-rich product line that can be incorporated into HOOQ's owned proprietary architecture, providing the flexibility the Company needs. Our infrastructure, reliability and proven support network in the region were other key differentiators in this significant customer win.

To further our leadership in the OTT and media markets, earlier today we announced the acquisition of Ooyala's OVP technology, including Ooyala's video content management and publishing platform, Backlot, Analytics, Live and its underlying IP and associated patents. As part of the transaction, Brightcove will acquire substantial portions of Ooyala's engineering, support and sales staff, including the Company's Guadalajara, Mexico operations. Media and related markets represent some of the most attractive growth opportunities for Brightcove. And the acquisition of the Ooyala OVP business puts us in an even stronger position to gain share in this strategic vertical.

We anticipate this transaction to be accretive on an adjusted EBITDA basis in 2019. Ooyala has tremendous global customers who understand the power of video and its ability to transform business and reach new customers. This transaction accelerates our ability to deliver faster innovation and deeper support for all customers. We also will increase our market reach and further strengthen our ability to secure new business in key target markets. We look forward to welcoming Ooyala's OVP customers and ensuring a smooth transition and a world-class experience for them.

There's one other point I would like to make clear about our market segmentation strategy. Over the past 15 years, we have developed the most sophisticated online video platform in the market and it is core to all of our solutions. The initial investments we are making will strengthen our core platform and will quickly benefit all customers. We're deeply committed to online market segments we have identified and take pride in how customers have used our products to grow their businesses.

In my early days at the Company, a common concern I heard from customers was the lack of a long-term product and innovation roadmap from Brightcove. In the past quarter, I've shared details about our market-driven strategy with many customers and thought leaders around the world. I'm encouraged by their confidence in our market segmentation work. The feedback we are now hearing from customers confirms that we're working on the right things, right now. In fact, their only idea for improvement is to move even faster and we will. These new solutions will build upon our rich product heritage.

As I mentioned earlier, Gartner Research recently validated our product strength when it included us in the Leader Quadrant in its most recent Magic Quadrant for the Enterprise Video Content Management market. In particular, our global presence, the robustness of our product performance and our high customer satisfaction scores positioned us very favorably versus our competitors. This report underscores our market leadership and customer desire to spend more with us as we introduce additional solutions that generates business value and customer success.

We were also thrilled to have recently secured the production and broadcast marks within the Digital Production Partnerships, DPP committed to security program. Since its launch in the UK a decade ago, the DPP has worked to establish a program that provides a standardized industry approach to cybersecurity that helps suppliers demonstrate their commitment to security best practices. Achieving these benchmarks demonstrates Brightcove's commitment to security of the massive amounts of data associated with video.

We've also made progress setting up our go-to-market teams for success. I strongly believe that if we make the customer experience, the organizing principle for Brightcove that we will be highly successful with our customers. This principle will apply to all functions which touch customers, including sales, marketing, product and support. We added the final piece to our senior executive team in the fourth quarter, with the hiring of Rick Hanson as our new Chief Revenue Officer.

Rick oversees the global sales organization, including all customer-facing direct sales, channel sales and professional services. He is a 25-year technology veteran, who joins us from CA Technologies, where he was the GM of North America and focused on the Global and Fortune 1000 and was previously a senior sales leader at HP and at RSA Security during his early high-growth stages. Rick has extensive experience and a great track record, running large enterprise sales teams as well as time with the venture-backed start-ups. In its first few weeks, Rick has hit the ground running, bringing new expertise, energy and passion that will drive more rigor and accountability to our sales organization.

This was evident at our recent sales kickoff meeting, where we aligned the global team on our product roadmap and market strategy. Our team left with a renewed confidence and a clear understanding of our vision, strategy and precise plans on how they will achieve their 2019 goals. Our marketing organization is hyper-focused on the quality of our sales pipeline and aligning it to our recent market segmentation work. This approach is helping us accurately focus our marketing investments toward prospective customers with the greatest propensity to spend with Brightcove.

We invest significantly in sales and marketing and it is imperative we are spending these resources efficiently and wisely. I feel great about the progress in our marketing group and the rigorous processes we have put in place to ensure we have a sales pipeline that consists of high quality leads that are continually vetted throughout the sales process. We now have all the leadership pieces in place that will be responsible for executing our strategy and improving our operational and financial performance.

I am seeing collaboration that has vastly improved from when I arrived. I'm excited by the buy-in we're seeing throughout the Company and I'm encouraged by the customer response. We entered 2019 a much stronger Company. We spent 2018 identifying what needed to be fixed, creating a strategy to address those issues and putting in place the organization, leaders and processes that will make our strategy successful. In 2019, our focus is on the execution of the strategy. Our top priorities are delivering our product roadmap.

You'll begin to see significant new innovations introduced in May at our PLAY conference and an aggressive product roadmap throughout the year; significantly improving our lead generation. We have put in place a targeted marketing strategy that will increase Brightcove's brand awareness and more accurately target our products to customers in order to expand our pipeline of opportunities. Today, we are not engaging with enough customers and getting enough opportunities to drive the type of revenue growth we know we can achieve. The success of our high velocity selling model rests on our ability to generate more qualified leads than we have historically done. Building a high velocity selling model.

As Rick comes on board, we are quickly building a best-in-class model for achieving high velocity sales growth. This includes reorganizing our sales structures globally to align with our market strategy; implementation of an account segmentation methodology; improved training and enablement and expansion of our channel sales program; obsessing on customer satisfaction. This is the organizing principle for Brightcove. We know we are successful when our products deliver value and customers love working with us. The loyalty of our installed base shows we do well at this, when given the chance. As a result, we will become a predictable high-growth business with substantial profitability.

To summarize, Brightcove accomplished much in 2018. We have a committed product roadmap tightly aligned to a comprehensive market analysis, put in place the building blocks for high-velocity selling model and attracted world-class leadership talent to execute on our strategic priorities. We're confident that we will begin to see the impact of these operational changes and I look forward to sharing our progress with you throughout the year.

With that, let me turn the call over to Rob.

Robert Noreck -- Executive Vice President and Chief Financial Officer

Thank you, Jeff and good afternoon, everyone. I will begin with a detailed review of our fourth quarter and full year results, and then I will finish with our outlook for the first quarter and the full year 2019. Total revenue in the fourth quarter was $40.9 million, which was slightly below our guidance range. As Jeff mentioned, the shortfall in revenue was largely driven by lower than expected services revenue and lower than expected overages revenue. We're seeing fewer customers enter overages at the tail end of their contract cycles which is leading to less overage revenue. As we look ahead to 2019, we are taking a more conservative approach to our overage revenue forecast to account for this dynamic.

Breaking revenue down further, subscription and support revenue was $37.8 million and professional services revenue was $3.1 million. On a geographic basis, we generated 54% of our revenue in North America during the quarter and 46% internationally. Breaking down international revenue a little more, Europe generated 17% of our revenue and Japan and Asia Pacific generated 29% of revenue during the quarter. We see continued momentum in Japan and Asia-Pac, both with new customer wins and expanded engagements with existing customers. From a vertical perspective, our media business represented 52% of our revenue in the quarter and our enterprise business represented 45% of our revenue, while volume business represented the remaining 3%.

Let me now turn to the supplemental metrics we share on a quarterly basis. Our recurring dollar retention rate in the fourth quarter was a 104%, which is well above our target of low to mid-90s. The strength in the quarter was driven by both stronger gross renewals as well as a large upsell at the time of renewal. We are pleased with the performance in the quarter and the impact of our renewed focus on customer success is having on retention. We do not expect retention rate to remain at this level going forward and continue to target our historical retention rate in the low to mid 90s.

Our customer count at the end of the fourth quarter was 3,783, of which, 2,226 were classified as premium customers. Looking at our ARPU within our premium customer base, our annualized revenue per premium customer was $75,000, which was up 3% year-over-year and excludes our entry-level pricing for starter customers which averaged $5,000 in annualized revenue.

Looking at our results on a GAAP basis, our gross profit was $24.4 million, operating loss was $2.5 million and loss per share was $0.07 for the quarter. Turning to our non-GAAP results. Our non-GAAP gross profit in the fourth quarter was $24.8 million compared to $24.5 million in the year-ago period and represented a gross margin of 61%. Subscription and support revenue represented approximately 92% of our total revenue and generated a 65% gross margin in the quarter, compared to a 68% gross margin in the fourth quarter of 2017. The decrease in gross margin was driven in large part by the decline in overage revenue.

Non-GAAP income from operations was $237,000 in the fourth quarter compared to non-GAAP income from operations of $1.3 million in the fourth quarter of 2017. Adjusted EBITDA was $1.4 million in the fourth quarter compared to $2.3 million in the year-ago period and above the high end of our guidance range for the quarter. The adjusted EBITDA outperformance was driven primarily by the timing of investments. Non-GAAP net income per share was breakeven, based on 37.4 million weighted average shares outstanding. This compares to an earnings per share of $0.04 on 35.5 million weighted average shares outstanding in the year-ago period.

Looking at our full year 2018 results, total revenue was $164.8 million, up 6% year-over-year. On a GAAP basis, gross profit was $98.2 million, operating loss was $13.1 million and loss per share was $0.39 based on 35.8 million weighted average shares outstanding. On a non-GAAP basis, gross profit was $100.6 million, loss from operations was $2.2 million and adjusted EBITDA was $2.3 million and loss per share was $0. 09 based on 35.8 million weighted average shares outstanding.

Turning to the balance sheet and cash flow, we ended the quarter with cash and cash equivalents of $29.3 million. During the fourth quarter, we generated $2.8 million in cash flow from operations and free cash flow was $2.1 million, after taking into account $682,000 in capital expenditures and capitalized internal-use software.

Before I finish with guidance, I would like to provide some financial details on the acquisition of Ooyala's OVP business. The purchase price is approximately $15 million which consists of $6.25 million in cash with the remainder in Brightcove's shares. We anticipate this transaction to be accretive on an adjusted EBITDA basis in 2019. We will provide a specific revenue contribution estimate when the deal is expected to close in first half of 2019. However, from a multiple perspective, we paid less than 1 times EV to revenue for these assets.

I'd now like to finish by providing our guidance for the first quarter and full year 2019. Please note, that this guidance does not incorporate any impact from the pending acquisition of Ooyala. We will update our guidance once the transaction closes later this year. For the first quarter, we are targeting a revenue of $40 million to $40.5 million, including approximately $2.7 million of professional services revenue. From a profitability perspective, we expect a non-GAAP operating loss of $900,000 to $1.4 million and adjusted EBITDA of a loss of $200,000 to a gain of $300,000. Non-GAAP net loss per share is expected to be in the range of $0.03 to $0.05 based on 36.7 million weighted average shares outstanding.

Turning to our outlook for the full year 2019, we are targeting revenue of $168 million to $172 million. This includes approximately a $11.1 million of professional services revenue. We are also taking a more conservative approach to forecasting overage revenue. We are now anticipating approximately $1.25 million of overage revenue per quarter or $5 million for the year. This compares to $8 million in 2018. In terms of profitability, we expect non-GAAP operating income of breakeven to $3 million and adjusted EBITDA of $5.2 million to $8.2 million. In addition, we expect non-GAAP net loss per share of $0.03 to non-GAAP net income per share of $0.05 based on 38.6 million weighted average shares outstanding.

For cash flow, we expect full year free cash flow in a range of $5 million to $8 million. We will no longer be providing guidance on bookings growth, which we believe provides limited value to investors. Instead, we believe it makes more sense to focus investors on the quarterly backlog metric that we are now required to report each quarter under ASC 606. We define backlog as the aggregate amount of committed subscription revenue that is related to future performance obligation. Backlog will be the leading financial indicator that demonstrates the success we are having, executed on our strategic priorities.

To summarize, Brightcove has its 2019 better positioned to achieve our long-term financial and operational objectives. We will deliver another year of adjusted EBITDA and free cash flow profitability even as we pivot the organization toward our new go-to-market and product strategy. We have more work to do to reach our long-term objectives but we feel very confident about our strategy to achieve breakout growth.

With that, we will now take your questions. Operator, we are ready to begin the Q& A.

Questions and Answers:

Operator

At this time, we will be conducting a question-and-answer session. (Operator Instructions) Our first question comes from the line of Sameet Sinha with B. Riley FBR. Please proceed with your question.

Sameet Sinha -- B. Riley FBR -- Analyst

Yes, thank you very much. A couple of questions. So, you spoke about overage and can you talk about the margin construct of overage revenues and also what the -- can you give us a reason why few of your customers are utilizing the overages? And second question as it relates to Ooyala, I just wanted to get a better sense of how this will help you kind of accelerate your plans? What specific assets will you be able to utilize and do they have a reseller network that you could utilize to kind of jump-start yours? And about these two technology platforms that you have right now, what are the plans that kind of emerging? Does it give you any new set of products that kind of fit into your nine subverticals that you've identified? Thank you.

Robert Noreck -- Executive Vice President and Chief Financial Officer

Yeah. Sure, Sameet. How are you doing? This is Rob. On the overage front, two points. One on the margin side as you know, not going into overages and is not having the higher overage number can impact margin, because overages and expense aren't necessarily always lined up. Customers typically go into overages at the end of their contract. And they may be running faster than their entitlement throughout the period of the contract. So the overages and expense don't necessarily lining -- line up. So we miss overages like that we -- it can have a detrimental impact on the margin.

In terms of why, there's a couple of different reasons. One, we see customers that are -- have been with us a while and they're more familiar with the amount of traffic that they're going to do. So they're not actually going into overages, they're actually buying the correct amount of entitlements. The second one is, we talked about this a little bit last quarter, but when customers early renew, they can take that overage revenue and they typically extend for a period of time but it commits that revenue over the future periods.

Jeff Ray -- Chief Executive Officer

And then -- hey, Sameet it's Jeff. I'll comment on the Ooyala acquisition. Yes, it does give us an opportunity to accelerate. First of all, it makes clear who the undisputed leader is in OVP. And as you know, when you are the market leader, customers and prospects naturally includes you in RFPs, they naturally come to you and that gives us, we think a great advantage. So we're thrilled about that.

We also have an opportunity to open up some new markets. They're -- they've got some geographies, some great well-known customers in geographies where we aren't very strong or not present at all. And we're excited about the ability to help that accelerate our global expansion. They do have a partner community. It's robust. And we're very eager to engage with those partners and fold them into our partnership strategy. And absolutely that the things that they have been doing for some of the largest media customers and users of OVP in the world are very consistent with our growth strategies. So we see nothing but create advantages in this acquisition.

Sameet Sinha -- B. Riley FBR -- Analyst

One quick follow. Ooyala was previously a part of Telstra and recently there was a management buyout and they became an independent Company. I think Telstra stayed on potentially as a reseller. Now do you have an agreement with Telstra as part of this kind of merger to continue that relationship?

Jeff Ray -- Chief Executive Officer

Yeah, we have not engaged at all with Telstra. We've been only engaging with the owners of Ooyala through the whole process. Ooyala does have a reseller agreement with Telstra and we're very, very eager to continue to support that. It's great for Telstra, it's great for the Australian market. We -- as you know we have very strong presence in ANZ. We're the clear winner already in media there. And so that just builds on a very strong local team there. And we're thrilled about having more access to Telstra and the community that Telstra serves.

Sameet Sinha -- B. Riley FBR -- Analyst

Okay. Thank you.

Jeff Ray -- Chief Executive Officer

Thank you.

Operator

Our next question comes from the line of Steven Frankel with Dougherty. Please proceed with your question.

Steven Frankel -- Dougherty & Company -- Analyst

Good afternoon. Just to follow-up on Ooyala, they obviously had their struggles under Telstra. What is their customer base look like today? And maybe give us an example of a couple of the marquee customers that you're going to be able to bring into your umbrella?

Jeff Ray -- Chief Executive Officer

Sure, be happy to. Yeah their customer base is strong and solid. We -- as you can imagine, we spent a lot of time on this and studying this and working with the Ooyala leadership and the extended team, including those principles who are responsible for supporting customers. And I'll tell you personally, I'm impressed with the loyalty and commitment that they've engendered with their customers.

They've done a great job of stabilizing that market. They demonstrated a strong commitment of support and quality and delivery. Their customers trust them in a way that's not inconsistent with ours and we're thrilled about picking that up. Obviously we have a broader set of products that we can sell into our base and we're eager to find opportunities to really expand the relationship with those customers. In terms of their customers that, I would just recommend you go to their website, you can see them. Their household names either globally or in their communities and their names that we will be very proud to have as part of the Brightcove family.

Steven Frankel -- Dougherty & Company -- Analyst

And how many customers they have in total?

Jeff Ray -- Chief Executive Officer

Yeah, we're not yet ready to share that information. We do have a good command of that and we feel very, very good about the customers that they have. We feel good about the mix in terms of size and complexity, the geographic diversity. And again, the customer satisfaction and loyalty that they have right now.

Steven Frankel -- Dougherty & Company -- Analyst

Okay. And now let's switch gears and talk about Q4 which on the one hand, had great renewals. On the other hand, this was typically a quarter where you signed a bunch of new deals and you actually had a net reduction in premium customers. Is this a close rate issue or a pipeline issue? And what specifically are you doing about it?

Jeff Ray -- Chief Executive Officer

Sure. I'll start and then Rob will pile on. It's a little bit of both. The pipeline when I joined in April, we spent a lot of time crawling through the pipeline. And quite frankly, the business was suffering from weakness in the pipeline in terms of size and quality of the pipeline and that was really the direct result of decisions that had been made a year ago to drive near-term profitable contribution through cutting, spending in marketing and demand gen activities. We've revamped those. We've redirected spend. It's very, very different this time around and that all spend for demand gen has very precise ROI objectives tied to it, a clear accountability.

In addition with the reorganization of the Company and the addition of Sara running Marketing, Charles running Engineering and product and Rick now running Global Sales, we've got very precise alignment between the product roadmap. And as we shared with you before, we have now real position in our strategy and our product roadmap, so we know what will be releasing when, to what markets. We've mapped that against very precise demand gen activities, literally down to a subregion within a geo and the timing of launching those demand gen activities and we also have a much tighter closed loop and feedback on the traction that we're getting from demand gen in ways that this Company never had before.

And then finally, we have recommitted to investing in sales enablement. That was another program that was defunded a year ago. The funding is back in place. The team is in place. We recruited very, very strong talent to run that. I think the best affirmation of it is, the recent sales kickoff. We brought in the sales people from around the world. For the first time, at least people who have been here for a long time told me, everyone got a -- had a clear understanding of the strategy.

And in fact, we actually pulled them and almost 90% of those people participating said they get it on the strategy and the roadmap and they're excited about it. They also got very precise product training based on the enablement work that we have begun. They also got their quota letters, their commission plans and their territory assignments. So when they got on the plane to go home, they had everything they needed to hit the ground running. This is a very, very different cadence and tone that has been set in the past.

Steven Frankel -- Dougherty & Company -- Analyst

And you're fully staffed now on the sales side?

Jeff Ray -- Chief Executive Officer

Yes, we are.

Steven Frankel -- Dougherty & Company -- Analyst

Okay. And one of the things Jeff you talked about last quarter was, a near-term bump in OpEx. But that wasn't going to continue into 2019. I want to know what kind of OpEx growth is factored into your guidance for 2019? Did that in fact happen? Or given that things are running a bit behind schedule, are we going to see some expense growth above trend line in at least the early part of 2019?

Jeff Ray -- Chief Executive Officer

So yeah, Steve we are consistent with what we talked about. We've got the money in what we're currently spending today to make the investments that we need and it's about reprioritizing the dollars versus spending more dollars. So built into the guidance we are -- year-over-year we're roughly flat on the operating expense side.

Steven Frankel -- Dougherty & Company -- Analyst

Okay. And, Jeff you have some pretty heady goals for the Company tied to your compensation plan. Yet, we're still sitting here with no growth in the subscription and support business. What gives you the confidence that this Company can grow anywhere near market rates? Because that's clearly been a challenge for the last several years.

Jeff Ray -- Chief Executive Officer

So that's a very fair question. First of all, it is a very new and very different Company. The timing is good. We just had our board meeting yesterday. And for the first time, all the key new leaders had an opportunity to give real clarity to the board on the strategy and the goals. What the board also saw for the first time was, an incredible alignment between sales, marketing and product. And to an individual, they noted they had never seen that before. And really the phrase that they used was, this is a new Company. So I feel very good about the people, the plans and the way that we are aligned to go-to-market.

Number two, the strategy work and again, we'll share a lot more at PLAY, precisely identifies where the traction is for the best growth. It's closest to what we already do that also gives us better than expected profit breakout opportunities for us. And then finally the whole sales execution model is set up in a profoundly different way than in the -- past. The fact that we can absorb Ooyala and fold that in and keep going, I think is an affirmation to the fact that this is a very different go-to market team. And for me, I believe that we'll see a significant impact in the second half. But I'm very, very encouraged by what I see as well as the board and the leadership team.

Steven Frankel -- Dougherty & Company -- Analyst

And last question. One of the classic problems Brightcove has had over the last couple of years is the leak in the bucket, whether it was the repricing or a couple of customers not renewing. Are there any material renewals in 2019 that could get in the way of delivering net revenue acceleration in the back half if you don't execute on those opportunities?

Jeff Ray -- Chief Executive Officer

Yeah, Steve there's nothing significant like we'd seen in the past. We've seen in the past large Companies that were the top one or two Companies in our -- from a percentage of revenue with us. And there's nothing that we see in those Companies there.

Steven Frankel -- Dougherty & Company -- Analyst

And the switch in overages, is that a function of market maturity? Customers now kind of understand and rightsize? And does that cause you to change your pricing model at all?

Jeff Ray -- Chief Executive Officer

Yeah, I don't think it's going to cause us to change our pricing model at all. We're going to continue to price the way we have been.

Steven Frankel -- Dougherty & Company -- Analyst

Okay. Thank you.

Jeff Ray -- Chief Executive Officer

Thank you, Steve.

Operator

(Operator Instructions) Our next question comes from the line of Mike Latimore with Northland Capital Markets. Please proceed with your question.

Vijay Davar -- Northland Capital Markets -- Analyst

Yeah, hi. This is Vijay here for Mike Latimore. You talked a lot about the product roadmap. I would like to hear a little more about any specific -- feature set or enhancements that you're targeting? And at the same time, how much does the acquisition of the Ooyala business that complements your product roadmap?

Jeff Ray -- Chief Executive Officer

Yeah we've shared a little bit. And again we'll be sharing a whole lot more at our PLAY event in May in Boston. So I certainly -- encourage you and others to join us there when we'll really share everything. What counts is the process. It was last summer that we made the call to build the strategy based on market needs, customer needs and being market and market segment driven instead of being product-centric. That caused the research to be done to identify the nine discrete markets. Out of those, four were highly attractive. From that, we developed very precise product roadmaps and that we engaged with the board in September to get their support and then the leadership team locked down for several days and we aligned all of our go-to-market sales, training, marketing all around product deliverables and timings.

We've also overlaid those to the geo. So we know where does the specific functionality and features will be most attractive within market segments, within geos. Focusing on the four does not mean we are abandoning the other five. There's great spillover for the other five markets. And again, the timing of Ooyala couldn't be better because when we began the discussion in earnest with Ooyala, our plans were locked down, the board was committed. We had already redirected our engineering resources and spend to these initiatives. And Ooyala's strategy and market dominance fits very, very nicely into what we're doing.

Vijay Davar -- Northland Capital Markets -- Analyst

Okay, great. And do you have a number for the CapEx for the year?

Robert Noreck -- Executive Vice President and Chief Financial Officer

Sorry, could you repeat the question?

Vijay Davar -- Northland Capital Markets -- Analyst

How much would be the CapEx for the full year?

Robert Noreck -- Executive Vice President and Chief Financial Officer

Yeah, it will be consistent with this year approximately.

Vijay Davar -- Northland Capital Markets -- Analyst

Okay, good. Thank you.

Operator

Ladies and gentlemen, we have reached the end of the question-and-answer session. And I would like to turn the call back to management for closing remarks.

Jeff Ray -- Chief Executive Officer

Thank you. Again, it's a very exciting time. We made good solid progress in the fourth quarter. That being said, we're very excited about the path that we're on for growth and we are absolutely committed to our market, to our customers to demonstrate that in the new year. We're thrilled to welcome the Ooyala customer family and employees and engineers to the Brightcove family and feel that we're really positioned for a breakout performance. Thank you all and I wish you all a great day.

Operator

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

Duration: 47 minutes

Call participants:

Brian Denyeau -- Investor Relations

Jeff Ray -- Chief Executive Officer

Robert Noreck -- Executive Vice President and Chief Financial Officer

Sameet Sinha -- B. Riley FBR -- Analyst

Steven Frankel -- Dougherty & Company -- Analyst

Vijay Davar -- Northland Capital Markets -- Analyst

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