2017 has been one of the most active years for corporate M&A activity, including Broadcom’s ($AVGO) $103 billion unsolicited offer to acquire Qualcomm ($QCOM). In the midst of all of this activity and booming equity markets, valuations have arguably become stretched. Now, companies with cash on their books are looking for any edge to help them identify opportunities and get ahead of the competition.
If you’re Broadcom, and you have over $13 billion in annual revenue and are looking to grow market share in the chip wars, perhaps investing $100 billion in a competitor makes sense.
But, where do companies that don’t have the resources of Broadcom go to find acquisition targets that may make them stronger, enable them to grow market share, enter new markets or vertically integrate their supply chain?
“AlphaSense is a great tool for getting up to speed on new companies and an industry very quickly.”
AI-powered professional search engine AlphaSense helps users research industries and companies quickly by accessing a curated database of millions of documents. Users save hours of time by searching across all of that content at once and viewing and sorting their results on one screen. Leveraging the platform’s proprietary AI technology, users are able to sort by relevance, expand searches using AI and find what others miss.
“I find AlphaSense incredibly useful. It significantly speeds up the investment process and allows me to find information I would not normally find.”
AlphaSense helps users find (unknown) competitors searching a particular topic, for example: hypertension drugs. AlphaSense scours broker reports, regulatory filings, company presentations, newspapers, trade journals, etc., to find information that corresponds to those keywords. It then assigns a relevancy score to each match, helping bring the items that are likely of most interest to the forefront.
In addition to the sources mentioned previously, AlphaSense now digs through private company news and press releases. This is particularly interesting due to the limited amount of information available on private companies. With more private company information, AlphaSense can shed light on companies and industries that may not be so transparent.
For example, we can use AlphaSense AI-powered professional search to research the grocery industry and identify potential targets. The grocery industry received increased attention this summer when Amazon ($AMZN) acquired Whole Foods Market ($WFM). Supermarkets are largely fragmented and generally operate within a city or region. For example, New York’s Fairway stores operate in lower New York and Northern New Jersey, and Vons (now a subsidiary of Albertsons, also a private company), can only be found in Southern California and Southern Nevada. In such a low-margin business, pressured by much larger companies such as Kroger ($KR), Walmart ($WMT) and now even Amazon, consolidation may be coming.
Albertons, the second largest grocery chain in the U.S. (after Kroger), has expressed interest in an IPO. Let’s assume the company goes public and plans to use the proceeds of their equity raise to fund acquisitions of regional grocers.
Using AlphaSense, Albertsons could quickly look at a few key players to assess their size. Let’s say a user on their strategy team is interested in Publix, an employee-owned company. She could type in Publix revenue as a keyword search in AlphaSense. To view only the most relevant search results, she could filter her results by going to the Sources menu and selecting Press Releases > Private Company.
What she’d quickly find is a press release from Publix which mentions it has $34 billion in sales with 1,147 locations.
She could then repeat the process with other companies she’s watching, such as Hy-Vee, a grocery chain in the Midwest. She’d discover that Hy-Vee has an annual revenue of $9.8 billion with 240 stores.
By searching through company press releases, the Albertsons strategy manager would find actual revenue information directly from the companies that released it, not analysts who make guesses on such metrics.
AlphaSense AI-powered professional search makes finding this information faster and easier than ever before. By gathering more information in less time, AlphaSense users can quickly compile the data they need to make smarter business decisions.
1. Broadcom Proposes to Buy Qualcomm for $103 billion, Wall Street Journal (accessed through AlphaSense), November 6, 2017
2. Entry into a Material Definitive Agreement, 8K, Amazon.com, Inc. (accessed through AlphaSense), June 16, 2017
3. America’s Largest Private Companies 2017, Forbes (accessed through AlphaSense), September 5, 2017
4. Albertsons is Said to Stall Renewed IPO Plans Amid Amazon Deal, National Real Estate Investor (accessed through AlphaSense), July 12, 2017