ServiceSource Shares Jumped: What You Need to Know
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of customer relationship management, or CRM, software specialist ServiceSource (NAS: SREV) popped 11% on Friday after raising its full-year guidance.
So what: Although ServiceSource's third-quarter loss widened, its new sales view for full-year 2011 -- $198-$199 million versus the consensus of $195.3 million -- is forcing analysts to up their growth estimates yet again. In fact, this is already the third time that management has raised its full-year revenue outlook since its March IPO.
Now what: ServiceSource's longer-term growth opportunities look pretty tasty as well. "With our recent expansion into new vertical markets, we estimate our target opportunity as greater than $250 billion," Chairman and CEO Mike Smerklo said. Of course, with established CRM gorillas like salesforce.com (NYS: CRM) and Oracle (NAS: ORCL) to deal with, steady market share gains won't exactly be easy.
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