Thursday, August 9, 2007

Interwoven Inc.

Interwoven Inc. is a NASDAQ listed security that has been trading in a range between $9.19 and $17.30 over the past year. With 43,584,000 shares outstanding, a recent price of $13.81 gives a total market capitalization of $575,308,792. While there are certainly larger companies, Interwoven Inc. has definitely earned its place in the pack. Last year, Interwoven Inc. created $0.07 in earnings for every share outstanding.

Interwoven Inc. is currently priced by the market at 188.50 times last year’s earnings. Many trading multiples around the world are quite attractive these days, but don’t be fooled. A Price to Earnings ratio of 0 simply means that the security didn’t make any money last year.

With a share price under $50 a share and earnings per share below $1 a share, Interwoven Inc. could be an interesting value proposition. Consistent earnings are the key to high valuations and this security is well on its way.

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