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Canaccord Raises Novatel Wireless Price Target Amid Solid 4Q14 Results And 2015 Growth Expectations


Canaccord Genuity analyst Michael Walkley came out today with a research report on Novatel Wireless Inc. (NASDAQ:MIFI), reiterating a Hold rating and raising the price target to $5.00 (from $3.00), which implies a downside of 6.0% from current levels.

The report comes after the company reported fourth-quarter results, with sales of $55.4 million above Canaccord’s $52.3M estimate.

Novatel noted, “Given recent changes in senior management, ongoing restructuring efforts, and the development of the company’s new strategic initiatives, we are encouraged by Novatel’s ability to achieve non-GAAP profitability and positive adjusted EBITDA sooner than our expectations. We anticipate gradually improving results and sustainably positive adjusted EBITDA in 2015 and beyond driven by growth in the Mobile Computing sales with new MiFi products shipping to Verizon and International carriers and improving trends in the higher margin M2M business combined with its lower operating cost structure post the restructuring.”

Bottom line, “We will continue to monitor Novatel’s progress on its planned business initiatives as the company attempts to significantly grow its higher-margin M2M business through M&A activities that management aspires to complete during 2015.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst T. Michael Walkley has a total average return of 25.0% and a 72.0% success rate. Walkley is ranked #3 out of 3479 analysts.