ValueClick: Strengths, Weaknesses, Opportunities, Threats

When you're looking at a potential new addition to your portfolio -- or reexamining an older holding -- SWOT analysis can be your best friend. Only by looking at a company from all angles can you form a true picture of the business, and running through strengths, weaknesses, opportunities, and threats does just that. Today, I'm looking at ValueClick (Nasdaq: VCLK  ) , an online marketing specialist that never seems to get enough attention.

Strengths

• Short of the Google (Nasdaq: GOOG  ) AdSense/AdWords package, ValueClick operates the largest network of small-publisher ad spots on the planet.
• Through its Commission Junction program, the company brokers advertiser and publisher relationships in the form of commission-based direct sales.
• Monetization of online traffic is a hot service these days, and ValueClick has more than a decade of brand-building operating history in this market.
• ValueClick delivers strong margins across the board, and operates from a rock-solid balance sheet with oodles of cash and no debt.
• Insiders are buying ValueClick stock today, which tends to be a good sign.

Weaknesses
In ValueClick's own words, "there are no significant barriers to entry to our industry."

• Competition is fierce, including head-to-head rival offerings from industry giants Google, Yahoo!,  eBay (Nasdaq: EBAY  ) , and Microsoft (Nasdaq: MSFT  ) .
• Growth opportunities seem few and far between, except for a rising tide lifting all boats in the marketing regatta.

Opportunities

• ValueClick is buying its way into new markets, as when it picked up investing resource Investopedia earlier this summer.
• Wall Street doesn't appear to expect much from the company, given its low P/E ratio but high PEG metric. It wouldn't take much of a surprise to light a fire under this stock.
• Clean fundamentals plus a rock-bottom valuation equals buyout bait, especially in a hotly contested market like online ad sales.

Threats

• If the sector's giants don't decide to buy ValueClick, they could very well smother it instead. Management needs to stay on top of its game in order to survive.
• Today's rock-bottom valuation could prove correct if ValueClick doesn't find a new growth catalyst in short order.

What's missing from this SWOT analysis of ValueClick? Complete the picture in the comments below.