UBS Maintains a 'Buy' on Nuance Communications (NUAN); Raising PT to $25; Expect Improving Ramp in FY11 as End-Markets Recover

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UBS maintains a 'Buy' on Nuance Communications (NASDAQ: NUAN), PT from $20 to $25.

UBS analyst says, "PT to $25 as roll-fwd 1 qtr and up P/E to 16x. NUAN is poised to see sequentially improving trend this FY as: (1) speech adoption accelerates in handsets, cars, and among mobile health care workers, (2) smartphones grow rapidly and gain advanced speech functionality thanks to faster processors and 3G/4G speeds, (3) automotive end-markets recover and design-win momentum translates to shipments/royalties, (4) Healthcare segment benefits from HITECH Act and new pdts, (5) Enterprise rebounds from negative comps, and (6) SaaS model matures."

"While we believe trends were solid, FQ1s can start off seasonally slow. We expect NUAN to post in-line to slight upside to our ests: rev UBSe $320M, Street $319M, guide $312-325M; EPS USBe $0.31, St. $0.31, guide $0.28-0.32. Date: early Feb."

For more ratings news on Nuance Communications click here and for the rating history of Nuance Communications click here.

Shares of Nuance Communications closed at $20.48 yesterday, with a 52 week range of $14.12-$20.60.

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