In his second Executive Decision segment of "Mad Money" Monday, Jim Cramer sat down with Robert LoCascio, CEO and founder of LivePerson Inc. (LPSN) , a stock that's up 70% for the year.
LoCascio said the millennial generation doesn't like to talk to people, which makes the old model of customer service and its attendant 1-800 number obsolete. Today's consumers want to use text messaging to talk to an intelligent agent to place orders, get answers and address customer service issues. That's why LivePerson's market for its business messaging technologies continues growing year after year, LoCascio said.
LoCascio said after starting LivePerson as a chat software provider, he realized five years ago that the future was in artificial intelligence, bots and automation, which is why he pivoted his company and is now a leader in this market.
LoCascio said LivePerson is not just a channel of communication but rather a transformation of how businesses operate. He said there's no reason why salespeople can't chat directly with customers before they arrive at a store, for example, something that retail has never seen before.
Let's see what the charts and indicators look like, unless you'd rather listen to an 800 recording.
In this daily bar chart of LPSN, below, we can see that prices reacted sharply lower on Monday but are still above the rising 50-day moving average line. The slower-to-react 200-day moving average line also shows a positive slope. The daily On-Balance-Volume (OBV) line shows a rising trend from late November and a new high this month to confirm the price strength with signs of aggressive buying. The Moving Average Convergence Divergence (MACD) oscillator is in a bullish configuration above the zero line but needs to be watched closely for a possible turn lower.
In this weekly bar chart of LPSN, below, we can see an impressive percentage move the past three years. Prices are above the rising 40-week moving average line. The weekly OBV line shows a bullish trend the past three years and the MACD oscillator recently crossed to the upside for a buy signal.
In this Point and Figure chart of LPSN, below, we can see Monday's reversal to the downside. A downside price target in the $28-$27 area is now projected by the software.
Bottom line strategy: Monday's decline in LPSN looks like it came from left field. I am not sure we are going to see prices weaken all that much and the $30 area should act as support.