Deutsche Bank Remains Bullish On Nuance Communications, Sees 66% Upside


In a research report sent to investors today, Deutsche Bank analyst Nandan Amladi maintained a Buy rating on Nuance Communications (NASDAQ:NUAN) with a $25 price target, which implies an upside of 66% from current levels.

Amladi observed, “NUAN shares are flat this year vs. the NASDAQ up 12%, on continuing concerns about NUAN’s revenue transition and downward guidance revisions. A decline in short interest and negative options skew suggest sentiment is getting more positive. Our view on the stock remains constructive, as we believe NUAN’s market opportunity and competitive position, particularly in the healthcare segment, are still strong. This note aims to frame the revenue model transition, competitive landscape and metrics investors should look for, ahead of earnings on November 24. We reiterate our Buy rating on sound fundamentals, cheap valuation and near-term catalysts.”

The analyst added, “Among software companies with specialized assets, NUAN represents one that is focused on multi-modal user interfaces for devices and services consumers use every day, an area that continues to see secular growth. The combination of an undervalued stock, the Icahn ownership, and upcoming earnings where we could see new metrics, offers catalysts that investors should take advantage of, as we look ahead to 2015.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Nandan Amladi has a total average return of 1.9% and a 54.2% success rate. Amladi has a -8.0% average return when recommending NUAN, and is ranked #1580 out of 3377 analysts.

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