Clarivate (CLVT) AI Stock Analysis

• Market Cap: $2.81B
• Dividend Yield: N/A
• Average Volume (3M): 7.05M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.00
• Revenue Growth: -2.74%
• EPS Growth: 34.70%
• Country: US
• Employees: 12,000
• Sector: Technology
• Sector Strength: 45
• Industry: Software
• EPS (TTM): -0.97
• Shares Outstanding: 691,638,370
• 10 Day Avg. Volume: 6,206,886
• 30 Day Avg. Volume: 7,048,552
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.10
• Price to Cash Flow (P/CF): 5.00
• P/FCF Ratio: 4.90
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $6.10
• Price Target Upside: 51.36% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

Clarivate's overall stock score reflects significant financial challenges, including declining revenue and persistent losses, despite strategic shifts highlighted in the earnings call. Technical indicators suggest bearish sentiment, and the valuation remains unattractive with a negative P/E ratio. While there are strategic initiatives to improve future performance, current financial instability and market sentiment weigh heavily on the score.

Positive Factors

Business recovery

The company’s IP business is tracking to rebound to growth as trademark search volumes stabilized and Derwent patent renewal rates improved.

Organic revenue growth

Improving macro conditions and product refresh cycles are expected to drive an acceleration in organic revenue growth from approximately 0.5% to 4%.

Subscription revenue

CLVT’s subscription revenue streams in its Academia & Government business remain healthy, bolstered by strong renewal rates of over 96%, large customer wins and AI product enhancements to Web of Science.

Negative Factors

Leadership challenges

CLVT is now under its third CEO in as many years, who will have a significant lift on his hands in order to turn around the business.

Organic growth

Deterioration across the business led to organic growth miss and removal of guidance.

Product and revenue challenges

Organic growth outlook was also impacted by product refresh delays in the Innography and Incopat products, with additional reoccurring revenue headwinds related to a push-out of the USPTO PCP contract to 2025.

Clarivate Business Overview & Revenue Model

Company Description

Clarivate Analytics Plc provides trusted insights and analytics to accelerate the pace of innovation. Its solutions include scientific and research, patent intelligence and compliance standards, pharmaceutical and biotech intelligence and trademark, domain and brand protection. The company product portfolio includes Life Science, Web of Science, Cortellis, Derwent, CompuMark, MarkMonitor and Techstreet. It helps clients to reduce the time from new ideas to life changing innovations. The company was founded in 1864 and is headquartered in St. Helier, Jersey.

How the Company Makes Money

Clarivate generates revenue through a subscription-based model, where clients pay for access to its comprehensive databases, analytics tools, and workflow solutions. The company's revenue streams are primarily derived from recurring subscriptions, which provide a steady and predictable income. Clarivate also earns from transactional services, where clients pay for specific, one-time data or analysis needs. Additionally, the company engages in strategic partnerships with academic institutions, corporations, and research entities to enhance its offerings and expand its client base. These partnerships often involve collaborative product development and integration, further bolstering Clarivate's market presence and revenue potential.

Clarivate Financial Statement Overview

Summary

Clarivate faces challenges with declining revenue, persistent net losses, and deteriorating cash flow. While the debt-to-equity ratio is moderate, reduced stockholders' equity and declining cash flows present risks. The company must focus on reversing the negative trends in revenue and profitability to enhance its financial stability and investor confidence.

Income Statement

Clarivate's income statement shows a concerning trend with declining total revenue from $2.66 billion in 2022 to $2.56 billion in 2024. The gross profit margin remains relatively stable at around 66%, but the company is struggling with negative EBIT and net income, leading to a negative net profit margin. The revenue growth has been negative over the past year, indicating challenges in maintaining growth. The company needs to address its profitability issues to improve its financial health.

Balance Sheet

The balance sheet reveals a moderate debt-to-equity ratio of approximately 0.89 in 2024, indicating a balanced approach to leveraging debt. However, the stockholders' equity has declined from $6 billion in 2023 to $5.1 billion in 2024, which is a concern. The equity ratio is around 44.7%, showing that the company relies heavily on debt financing. Clarivate's balance sheet stability is moderate, but declining equity could pose future risks.

Cash Flow

Clarivate's cash flow statement shows a decrease in operating cash flow from $744 million in 2023 to $646 million in 2024. Free cash flow has also decreased significantly over the last year. The free cash flow to net income ratio is negative due to negative net income, indicating that cash flow is not sufficient to cover net losses. Despite generating positive free cash flow, the declining trend is a concern for future cash flow stability.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
2.56B	2.63B	2.66B	2.66B	1.88B
	Gross Profit
1.69B	1.72B	1.71B	1.71B	1.25B
	EBIT
-275.60M	-734.70M	-3.93B	590.20M	42.48M
	EBITDA
456.60M	-10.50M	-3.01B	532.15M	52.38M
	Net Income Common Stockholders
-668.00M	-911.20M	-3.96B	-3.96B	-270.45M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
295.20M	370.70M	348.80M	348.80M	430.88M
	Total Assets
11.49B	12.71B	13.94B	13.94B	20.18B
	Total Debt
4.59B	4.81B	5.10B	5.10B	5.61B
	Net Debt
4.30B	4.44B	4.76B	4.76B	5.18B
	Total Liabilities
6.35B	6.71B	7.13B	7.13B	8.26B
	Stockholders Equity
5.14B	5.99B	6.81B	6.81B	11.93B
Cash Flow		Free Cash Flow
357.50M	501.70M	306.40M	306.40M	205.22M
	Operating Cash Flow
646.60M	744.20M	509.30M	509.30M	323.77M
	Investing Cash Flow
-236.70M	-237.40M	57.30M	57.30M	-4.04B
	Financing Cash Flow
-470.10M	-496.50M	-759.20M	-759.20M	4.03B

Clarivate Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4.03
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CLVT, the sentiment is Negative. The current price of 4.03 is below the 20-day moving average (MA) of 4.48, below the 50-day MA of 4.92, and below the 200-day MA of 5.74, indicating a bearish trend. The MACD of -0.25 indicates Positive momentum. The RSI at 28.86 is Positive, neither overbought nor oversold. The STOCH value of 24.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CLVT.

Clarivate Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RELX	78 Outperform	$87.64B	35.64	56.34%	1.64%	5.86%	13.13%
MORN	70 Outperform	$12.18B	33.14	25.11%	0.59%	11.60%	161.17%
TRU	69 Neutral	$16.06B	55.92	6.91%	0.52%	9.20%	―
VRSK	64 Neutral	$40.75B	44.42	463.98%	0.52%	7.47%	59.46%
DNB	61 Neutral	$3.55B	―	-0.85%	2.48%	2.93%	39.49%
Sector *	58 Neutral	$21.35B	9.96	-19.72%	2.38%	5.03%	-22.83%
CLVT	48 Neutral	$2.81B	―	-11.44%	―	-2.74%	34.70%

Clarivate Corporate Events

Clarivate Reports 2024 Financial Results and Strategic Shift

On February 19, 2025, Clarivate reported its fourth quarter and full year 2024 financial results, showing a total revenue decrease to $2.56 billion from $2.63 billion in 2023. Despite a decreased net loss for the year, the company is actively shifting from transactional to subscription-based revenue, investing in AI-powered products, and considering strategic alternatives such as divestitures. Clarivate also repurchased $200 million in shares and prepaid $198 million of debt in 2024, with a new share repurchase program authorized for 2025-2026.

Clarivate Announces $500M Share Buyback Program

Clarivate Plc announced a new share repurchase program authorizing the buyback of up to $500 million of its outstanding ordinary shares over a two-year period starting January 1, 2025. This move reflects the company’s confidence in its growth and financial performance, complementing its capital allocation strategy, which includes returning capital to shareholders and reducing debt obligations.