Unisys (UIS) PT Lowered to $6.50 at Canaccord Genuity

Canaccord Genuity analyst Joseph Vafi lowered the price target on Unisys (NYSE: UIS) to $6.50 (from $7.00) while maintaining a Hold rating.

The analyst commented: "While not necessarily showing up in guidance at this point, UIS continues to make solid progress on its growth initiatives. At this point we see the company's newest service offerings in its targeted markets as not just competitive, but in the leaders' quadrant. At the same time we recognize that part of the legacy UIS service portfolio is just that, and is more subject to whims in volumes driven by macro or industry factors. And then there is also FX for a company deriving ~60% of revenue ex US. Putting all of this together, the setup for Q1 leads us to remain on the sidelines despite what we see as a lot of positives just under the surface here. We note that from a standing start a few years back, next-generation service revenue, which includes higher growth cloud-based and higher software content solutions, now comprise over 40% of the service revenue. We believe this positive mix shift will continue, which, in turn, over time will drive growth and margins higher."

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