Artificial intelligence is revolutionizing business operations, automating tasks, improving decision-making, and driving efficiency.

Clarivate (CLVT) has embraced AI to enhance its offerings in research, intellectual property, and life sciences through tools like the Web of Science assistant and Derwent’s AI Search.

These tools streamline complex tasks, provide actionable insights, and deliver strong financial performance.

However, market concerns about competitive pressures are still present.

Despite this, Clarivate’s AI-driven solutions position it to meet rising demand, making it a compelling option for investors seeking value in AI.

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Artificial intelligence is transforming business operations by automating tasks, enhancing decision-making, and boosting efficiency.

AI tools analyze vast data sets to identify patterns and trends, enabling businesses to make informed decisions swiftly.

For instance, AI-driven analytics can forecast market trends based on customer behavior, aiding in strategic planning.

Additionally, AI automates repetitive tasks, allowing employees to focus on more complex and creative aspects of their work.

As AI continues to evolve, its integration into various business functions is becoming essential for companies aiming to maintain a competitive edge in the digital age.

That’s why Clarivate (CLVT) started to embrace AI…

The company provides insights and analytics to help with research, patents, and trademarks.

It offers enriched data, workflow solutions, and expert services across various sectors like academia, government, intellectual property, and life sciences.

Lately, Clarivate has introduced the Web of Science research assistant, a generative AI-powered tool designed to streamline academic research.

This assistant helps researchers quickly find key papers, manage complex tasks, and visualize connections within scholarly data.

Additionally, Clarivate has launched an enhanced search platform leveraging generative AI, enabling professionals in the life sciences and healthcare sectors to interact with complex datasets using natural language.

Furthermore, the company launched the AI Search within Derwent earlier this month. This tool combines AI with the Derwent World Patents Index, enabling intellectual property professionals to quickly identify relevant patents from a database of over 160 million records.

The AI Search feature uses a language transformer model to understand the context of input text, delivering pertinent results swiftly.

This tool benefits patent researchers, attorneys, and R&D professionals by facilitating accurate initial patentability searches and thorough validation to ensure no relevant records are overlooked.

By embracing AI, Clarivate managed to achieve a 131% Uniform return on assets ”ROA” and an 11% asset growth last year.

Despite these strong figures, the market is concerned about competitive pressures, reflected by the company’s 13x Uniform P/E ratio.

We can also see this through our Embedded Expectations Analysis (“EEA”) framework.

The EEA starts by looking at a company’s current stock price. From there, we can calculate what the market expects from the company’s future cash flows. We then compare that with our own cash-flow projections.

In short, it tells us how well a company has to perform in the future to be worth what the market is paying for it today.

At the current stock price, the market predicts that Clarivate’s Uniform ROA will fall to around 45%.

By leveraging AI-driven solutions and expanding its service offerings, the company is well-equipped to meet the increasing demand for actionable insights.

As clients continue to seek reliable and efficient tools to inform their strategies, Clarivate’s comprehensive solutions are likely to play a pivotal role in supporting their success, making it an attractive option for investors seeking value in AI.

Best regards,

Joel Litman & Rob Spivey
Chief Investment Officer &
Director of Research
at Valens Research