FBR Capital Starts TeleNav (TNAV) at Outperform
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FBR Capital initiates coverage on TeleNav (NASDAQ: TNAV) with a Outperform rating and a price target of $15.00.
Analyst Christopher Van Horn commented, "We are initiating coverage of Telenav, Inc. (TNAV) with an Outperform rating and a $15 price target. The company is, in our view, best positioned to capture share in a growing embedded-connected automotive navigation market that could become a key part of OEM and regulator emphasis on ADAS and vehicle-to-infrastructure technologies. In fact, over the long term, we believe positioning and navigation information like that provided by Telenav could be a key component of autonomous driving. However, current levels do not appear to reflect the market opportunity facing this company; instead, an ongoing business transition away from mobile phone navigation, toward automotive, has diluted profits and led the stock lower. We think this is a relatively short-term phenomenon obscuring a significant longterm opportunity. We estimate that Telenav's opportunity set deserves a 2.1x target EV/sales multiple (NTM basis); this is in line with comps and in our view is supported by recent M&A multiples in the navigation space. Based on this, we recommend the shares at current levels."
Shares of TeleNav closed at $5.72 yesterday.
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