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Author Topic: SSTK (Shutterstock's stock) closed down 10.98% today - why?  (Read 5723 times)

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« on: May 03, 2023, 15:40 »
+3
I looked around to see if there was any bad news about the agency that might have spooked the stock market, but didn't find anything.

The stock closed at $54.91. The DOW and Nasdaq were only down a fraction (about 0.50%); tech stocks were mixed but were +/- 1%; Adobe's stock was down 6.35% but I'm guessing that was about its Figma acquisition running into regulatory problems, not something related to their agency.

I looked at LinkedIn to see if Paul Hennessey had moved on, but apparently not :). Their Q1 numbers were decent and they upped their dividend to 27.

Does anyone have any idea why investors are unhappy?


« Reply #1 on: May 03, 2023, 22:03 »
+3
Dishonesty perhaps?

« Reply #2 on: May 04, 2023, 02:34 »
+4
Maybe they aren't seeing a bright future for microstock sites because of the AI image development?

« Reply #3 on: May 04, 2023, 05:25 »
+1
Funny... insiders sold SSTK shares during months of this report.
According to simplywallst to be exact in Feb15/16, 21224 shares sold and 0 buy. last buy was 10K in 10Jun 2022.

If we take in account last month SSTK lost -18.95 (-25.66%). So basically lost nearly 26% of company value.
Adobe lost nearly 10% in past month....


« Reply #4 on: May 04, 2023, 16:05 »
+2
SSTK close today was $51.84, down another $3.07 (-5.59%) on yesterday

The only new information I found was this article about "...an unusually large $440.00K block of Put contracts in Shutterstock (SSTK) was bought, with a strike price of $47.50 / share, expiring in 261 day(s) (on January 19, 2024)". Timing was around midday yesterday (May 3)

https://www.nasdaq.com/articles/unusual-put-option-trade-in-shutterstock-sstk-worth-%24440.00k

I'm not well versed in these financial gambles, but this article explains a put option - which I think means the person buying those is betting the stock will drop. As to why someone wants to play games with SSTK, I'm none the wiser...

https://www.investopedia.com/terms/p/putoption.asp


« Reply #5 on: May 04, 2023, 16:34 »
+2
Someone is betting on a fall in the Shutterstock share price. It is still unclear whether it is an insider. The only thing that stands out is the uncharacteristically high amount of put options with a basis of $47.50 and a maturity date of 19 January 2024. The bet seems to go against the market trend. But with the interest rate trend, a market correction is long overdue. Tech-Stocks tend to be too expensive (economic worries and high leverage). And if the option was cheap, a hedging position is quite conceivable even without insider knowledge. Sell in may and go away!


« Reply #6 on: May 04, 2023, 20:21 »
+2
Maybe investors are privy to earnings data which is sinking faster than the RMS Lusitania.

« Reply #7 on: May 05, 2023, 05:15 »
0
Well the rise of AI could have investors worried. Adobe has other income, stock ist just a small part.


« Reply #8 on: May 05, 2023, 11:07 »
+1
Well the rise of AI could have investors worried. Adobe has other income, stock ist just a small part.

The Motley Fool article seems to share your view -

https://www.fool.com/investing/2023/05/05/why-uipath-shutterstock-and-duolingo-are-plummetin/

"Shares of UiPath (PATH), Shutterstock (SSTK), and Duolingo (DUOL) have seen big losses in this week's trading amid concerns that artificial intelligence (AI) will disrupt their businesses. "

"Shutterstock actually has a partnership with OpenAI and has been working to integrate AI-generated content into its platform. But the partnership with the AI pioneer clearly hasn't been enough to put investors at ease about potential risks of disruption. It looks as if AI-generated content will continue to improve and become more popular, and that poses a significant threat to Shutterstock as it currently exists. While the company could eventually become a bigger player in AI content generation, its current business model revolves primarily around stock images, music, and videos."

Market is still open, bit SSTK is down another $1.06 (-2.04%) at $50.78

ADH

« Reply #9 on: May 05, 2023, 14:37 »
+2
Of course AI will demolish SS. A business concentrated in cheap stuff attracts cheap buyers, and cheap buyers will create their own AI images before paying this greedy bas_rds a dime. In the long run only adobe and Getty (maybe) will survive. For the rest...expect lot of Eye-em like bankruptcies.

« Reply #10 on: May 05, 2023, 14:47 »
+5
Personally, I think the concerns over AI are overblown. AI has been around for some time but, has it really revolutionized anything? Not really. Does it have that potential? Maybe but, equally, it may just sit alongside traditional techniques. Good for some things not so good for others.

At the end of the day, will it be easier and cheaper for a customer to buy or generate an image from SS or will it be easier and cheaper to do it themselves? It's the age old business question (MBA 101) whether to make or buy.

Markets get jittery all the time and especially in the current climate. But that doesn't mean they are right. Of course, I don't own any shares in SS and, should the business fail, it would be a very minor hit to my income stream. So it's easy for me to be sanguine.

« Reply #11 on: May 06, 2023, 01:56 »
+2
AI is the future.
Because of Adobe Firefly i would invest in Adobe and not in Shutterstock.

« Reply #12 on: May 06, 2023, 04:03 »
+1
We can only hope and pray that shitterstock goes bust and takes Oringers fortune with it.

This would be hilarious  ;D

« Reply #13 on: May 06, 2023, 09:03 »
+1
...Because of Adobe Firefly i would invest in Adobe and not in Shutterstock.

Have you used the Firefly beta?

IMO it is unusable for most people for most purposes at the moment.

« Reply #14 on: May 06, 2023, 09:34 »
+1
No, i have not till now.
But i think Adobe has enough power to get it work.

« Reply #15 on: May 06, 2023, 11:23 »
0
Well the rise of AI could have investors worried. Adobe has other income, stock ist just a small part.
IMHO SS and Adobe have a huge advantage in the AI world with unclear copyright statuses. I don't believe that MJ and SD will be cancelled in any way, but SS have an enormous legal base for training. He will remain a big player in any case. Except if he p*ss off the contributors so much, that the base will go down. Which is still possible, I think.
I mean, AI revolution will not destroy it (nor make it stronger). SS will keep it's position.

« Reply #16 on: May 06, 2023, 13:55 »
+7
Personally, I think the concerns over AI are overblown. AI has been around for some time but, has it really revolutionized anything? Not really. Does it have that potential? Maybe but, equally, it may just sit alongside traditional techniques. Good for some things not so good for others. (...)

This sounds more or less like 2002 "digital will never replace film"  ;)


« Reply #17 on: May 06, 2023, 20:10 »
+2
Personally, I think the concerns over AI are overblown. AI has been around for some time but, has it really revolutionized anything? Not really. Does it have that potential? Maybe but, equally, it may just sit alongside traditional techniques. Good for some things not so good for others. (...)

This sounds more or less like 2002 "digital will never replace film"  ;)

For what it's worth, as soon as I saw the first digital cameras, I knew film was doomed. That was around 1997. One of my clients was a film processing lab and I told them their days were numbered. They didn't like it ... lol. I don't feel that way about AI.

« Reply #18 on: May 07, 2023, 23:18 »
+2
...Because of Adobe Firefly i would invest in Adobe and not in Shutterstock.

Have you used the Firefly beta?

IMO it is unusable for most people for most purposes at the moment.

I actually found firefly better than midjourney & Dall-E but that could be because I only bought about $15 worth of credits on Dall-E which left me with concepts that needed a lot of illustration on my part to make them useable.

Because there was no time limit to my use of the Adobe firefly beta, I spent hours working on concepts. They still needed some hand finishing via a drawing tablet, but it was a lot less work that the others. Of course, like anything, the longer you practice something, the better you get at it.

I wish that I could use some of my final versions commercially and hope that when it's out of beta I can. Meanwhile, I've made some fun illustrations that delight my grandson. And I'm learning a new skill without spending a fortune.

I still prefer getting out with my camera. AI is a crapshoot. You can get close to what you want and then it changes and the final tweaks become impossible. I have more patience waiting for the right light when I"m shooting a landscape, or anticipating an image if I'm doing editorial work.

Seeing something appear when I type in a concept is amusing but even with tweaking the prompt  there is still so much randomness (and I'm a writer so words come easy). That lack of control is frustrating. Sure, I can't always control what happens in front of my lens, but I can control my response to it, and that's far more satisfying.
« Last Edit: May 07, 2023, 23:24 by wordplanet »

« Reply #19 on: May 11, 2023, 07:58 »
+5
Looks like the big fish has begun eating itself.

Take all its users content and use it to train an A.I. to make content that any buyer might want or need and getting progressively better with each iteration.

Contributers no longer required.

No new content.

A.I. not able to evolve without new and relevant content so produces homogenised results. The exact opposite of new, creative and relevant content.

Buyers drift away.

But even worse Buyers are out of business too because who needs them to find content for you when an A.I. can do that job too. And buy for who ... when an A.I. can do that job as well. And to sell to who because A.I. can create bots to pretend to be customers who don't buy ...

If that's the cause plus all the legal cases ongoing and coming then the writing is on the wall.


« Reply #20 on: May 11, 2023, 09:15 »
+4
Looks like the big fish has begun eating itself.

Take all its users content and use it to train an A.I. to make content that any buyer might want or need and getting progressively better with each iteration.

Contributers no longer required.

No new content.

A.I. not able to evolve without new and relevant content so produces homogenised results. The exact opposite of new, creative and relevant content.

Buyers drift away.

But even worse Buyers are out of business too because who needs them to find content for you when an A.I. can do that job too. And buy for who ... when an A.I. can do that job as well. And to sell to who because A.I. can create bots to pretend to be customers who don't buy ...

If that's the cause plus all the legal cases ongoing and coming then the writing is on the wall.

« Reply #21 on: May 11, 2023, 09:21 »
+2
...

« Reply #22 on: May 11, 2023, 16:00 »
+1
Shutterstock had a mini-rally earlier this week, but closed today at $52.63 (down $2.11 from Wed)

https://finance.yahoo.com/news/peri-sstk-better-value-stock-154003633.html

For some reason I can't fathom - other than the investor newsletter just has no clue about the businesses these companies are actually engaged in and how they work (who the customers are) - this article put Shutterstock and Perion in the same business category:

https://finance.yahoo.com/news/peri-sstk-better-value-stock-154003633.html

I looked at Perion's home page and it's full of buzzy fluff about capturing digital dollars, or fragmenting technology (slight misrepresentation on my part):

"Perion is focused on the future, and has built a tech-stack that drives our Capture & Convince business solutions. Our AI and machine learning can be applied to sourcing and optimizing traffic, transforming dumb funnels into smart consumer journeys."

I don't think they're in the same business at all, but at the end, the article about taking advantage of undervalued stocks recommends buying Perion's stock, not SSTK

"Both PERI and SSTK are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that PERI is the superior value option right now."

Here's a more general article about what Perion does - I have no love for SSTK, but it must be frustrating to have investment advisers lump you in with the wrong bucket and then drag the stock down as a result. But them's the breaks when you decide to go public

https://seekingalpha.com/article/4584594-perion-network-still-very-discounted


https://www.perion.com/

Edited to add that the stock closed down a bit more Tuesday 16 May - $51.29, (down $1.67 from Monday).

Tomorrow afternoon SS is hosting a (streaming) Gen AI event "AI is the game changer of all game changerssomething every brand and business in the industry can gain from. Dont forget to book your seat so you can learn how to make it work for you." They're clearly hoping if they bang the AI drum enough it'll do them some good.

Separately I saw a marketing piece - misspelled drivel, IMO - that says there's huge growth ahead. Probably not all that well researched as they include (the now bankrupt) EyeEm in the list of "top companies"

https://www.digitaljournal.com/pr/news/a2z-market-research/stock-photos-and-videos-market-to-witness-huge-growth-by-2029-adobe-stock-shutterstock-fotosearch

"Stock Photos and Videos Market is growing at a +7% CAGR during the forecast period 2023-2030. The increasing interest of the individuals in this industry is that the major reason for the expansion of this market"

Edited May 26 to add that SSTK closed yesterday at $48.94, so there's clearly something bothering investors. Their "ex-dividend date" (last day to be qualified to receive the next stock dividend) is May 31 and typically that causes the stock price to go up a bit as people buy...

May 30 close, $47.22
« Last Edit: May 30, 2023, 16:19 by Jo Ann Snover »


 

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