Cloud-based marketing technology software provider Bridgeline Digital (BLIN) has seen its share price skyrocket over the past month thanks to the growing adoption of its site search and recommendation platform. However, the company could face bumps in the road in the coming months owing to its uncertain growth potential. So, can the stock keep rallying? Let’s discuss.Digital engagement company Bridgeline Digital, Inc. (BLIN) offers a unified and scalable platform to enable businesses to create websites, publish content via a browser-based interface and other web design, and development services. BLIN’s eCommerce360 strategy has accelerated the company’s sales and growth opportunities significantly. Its revenue from software as a service (Saas) subscriptions and perpetual licenses increased 8% year-over-year to $1.99 million, driven by significant multi-year license renewals across its diverse portfolio of Fortune 500 companies. BLIN is based in Burlington, Mass.
BLIN’s stock has gained 141.4% over the past month on news that its site search network Hawksearch had won multi-year contracts. But while the acquisition of Woorank SRL and Hawk Search, Inc. should result in faster customer wins and help accelerate its services revenue, the company has suffered significant operational and net losses in its last reported quarter because of higher restructuring and acquisition-related expenses.
The stock is currently trading 59% below its 52-week high of $14.38, which it hit on July 6. We think BLIN’s mixed growth potential and profitability make the stock’s near-term prospects look uncertain now.