LivePerson's Latest Moves Leave Analyst Skeptical About Consistent Execution
- Needham analyst Ryan MacDonald maintains a Hold rating on LivePerson, Inc (NASDAQ: LPSN).
- The re-rating reflects the company's March transactions, with included the divestiture of consumer business Kasamba and the repurchase of convertible debt.
- The analyst gives a thumbs up to the divestiture, which will eliminate LPSN's consumer segment as they reallocate resources and focus on the core B2B segment.
- The divestment will reduce revenue but should have no impact on adjusted EBITDA. The company also repurchased $157.5 million of convertible notes.
- In April, LPSN announced a partnership with Cohere.AI to innovate on large language models (LLMs), both internally and for customers. Through the partnership, LPSN announced a pilot program where enterprise brands could access a natural language processing platform for language generation, allowing them to create and deploy LLMs to improve customer engagement and enhance business outcomes.
- However, the analyst sees plenty of uncertainty in the core business, given macro impacts and the early nature of the Wild Health business. Adding to execution risk is the recent confirmation that LPSN's CRO departed the company.
- Given these factors and recent track record, the analyst maintains a Hold rating pending more consistent execution.
- Price Action: LPSN shares traded higher by 7.54% at $5.07 on the last check Thursday.
Latest Ratings for LPSN
| Date | Firm | Action | From | To |
|---|---|---|---|---|
| Feb 2022 | Barclays | Maintains | Underweight | |
| Feb 2022 | Mizuho | Maintains | Neutral | |
| Feb 2022 | Roth Capital | Downgrades | Buy | Neutral |
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