Clarivate Plc (CLVT): A Bull Case Theory
A state-of-the-art computer lab filled with engineers working on new analytics technologies.
Clarivate (CLVT) is a leading data and analytics platform across Academia & Government (A&G), Intellectual Property (IP), and Life Sciences & Healthcare (LS&H), with over 80% recurring revenues and renewal rates above 90%. A&G, accounting for roughly half of revenue, benefits from deep entrenchment in the top 50 universities globally via ProQuest's Web of Science, boasting pricing power and minimal churn. IP, about a third of revenue, leverages CPA Global, Derwent, and CompuMark to manage patents, trademarks, and renewals for 1,600+ organizations, commanding scale-driven cost advantages.
LS&H, the smallest but fastest-growing segment, is rebuilding from past missteps with enriched real-world data and epidemiology intelligence, supported by AI-led product enhancements. Despite a durable competitive moat—driven by highly curated proprietary data, entrenched workflows, and high switching costs—shareholders have endured years of weak organic growth, heavy leverage, and significant goodwill impairments. The 2021 ProQuest and 2020 CPA Global acquisitions diluted equity and left net debt at 4.7x EBITDA, with Clarivate still unprofitable despite generating $350–380M in annual FCF.
New CEO Matitiahu Shem Tov, a SaaS veteran, is executing a turnaround plan by divesting low-margin transactional businesses, focusing on subscriptions (now 81–83% of revenue), and revitalizing LS&H to drive 4–5% organic growth. Success hinges on accelerating contract value growth, expanding LS&H, and further debt reduction. While at sub-$3B market cap, Clarivate screens inexpensive versus FCF, it remains a complex turnaround with upside from operational execution, AI-enabled product innovation, and organic growth normalization, but downside risk if execution stalls or leverage persists.
Previously, we covered a on TTEC Holdings, Inc. (TTEC) by burnoutstory in May 2025, which highlighted founder Ken Tuchman's $6.85 per share take-private offer and the company's undervaluation despite significant revenue and AI-driven SaaS growth. The stock has appreciated by approximately 0.97% since our coverage, as the thesis largely remains intact. Sediment shares a similar thesis on Clarivate Plc, focusing on a data-heavy turnaround with leverage concerns.
Clarivate Plc is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 25 hedge fund portfolios held CLVT at the end of the first quarter which was 20 in the previous quarter. While we acknowledge the potential of CLVT as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None.
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