Analyst Jeff Osborne of TD Cowen maintained a Buy rating on Cerence (CRNC – Research Report), with a price target of $27.00.
Jeff Osborne has given his Buy rating due to a combination of factors regarding Cerence’s current financial performance and future prospects. The first quarter of fiscal year 2024 revealed that Cerence’s revenues and profitability metrics surpassed the company’s own projections, indicating a stronger-than-anticipated financial health. Additionally, key growth indicators such as billings per car (excluding the legacy contract with Toyota) have shown an upward trajectory, evidencing a robust demand for Cerence’s offerings. With the number of connected cars and monthly active users experiencing significant year-over-year growth, the underlying market dynamics appear to be favorable for Cerence’s business model.
Furthermore, Osborne recognizes the strategic value in Cerence’s recent business developments, including new platform releases and the expansion of its AI innovation roadmap. Cerence’s technology has garnered validation from global OEMs, leading to new opportunities and discussions about potential customer win-backs, which could further strengthen its market position. Despite a cautious near-term outlook with the second quarter guidance falling short of expectations, Osborne’s recommendation suggests confidence in Cerence’s ability to manage its fixed contract revenues effectively and capitalize on the growing interest in its innovative AIoT products and solutions.
According to TipRanks, Osborne is a 2-star analyst with an average return of -0.3% and a 40.52% success rate. Osborne covers the Technology sector, focusing on stocks such as Cerence, First Solar, and Itron.
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Cerence (CRNC) Company Description:
Cerence, Inc. builds automotive cognitive assistance solutions to power natural and intuitive interactions between automobiles, drivers and passengers, and the broader digital world. It also engages in the sale of software licenses and cloud-connected services. The company was founded on February 14, 2019 and is headquartered in Burlington, MA.
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