Nuance (NUAN) Slowly Moving In The Right Direction, Oppenheimer Says

Oppenheimer analyst Shaul Eyal reiterated an Outperform rating and $22 price target on Nuance Communications (NASDAQ: NUAN) following Q4 results, saying the company is slowly moving in the right direction.

Eyal commented, "NUAN reported a solid F4Q with revenue, EPS, deferred revenue, and cash flow from operations all exceeding estimates. Improved execution (anybody said Icahn?) coupled with stable demand trends are behind the solid results. Whereas F1Q15 outlook is slightly below consensus given typical seasonality, the overall FY15 revenue outlook is essentially in line with EPS firmly intact (suggesting ongoing cost improvement). Investors could be drawn to NUAN on the heels of: 1. Slightly improved performance suggesting limited downside; 2. Gradually expanding margins; 3. Activist on board (yet unusually silent for more than a year) 4. Attractive valuation at 12x FY16 EPS."

The firm is introducing FY15 quarterly estimates. For FY15E, we now expect $1.15/$2.05B from $1.20/$2.10B. FY16E are $1.25/$2.19B.

For an analyst ratings summary and ratings history on Nuance Communications click here. For more ratings news on Nuance Communications click here.

Shares of Nuance Communications closed at $15.31 yesterday.

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