A Fresh Look at nCino (NCNO) Valuation After Consecutive Analyst Upgrades and Spanish Market Expansion

Shares of nCino (NCNO) moved higher after two research firms issued consecutive upgrades, citing recent price declines as a new opportunity and highlighting the company’s international expansion and technology adoption.

See our latest analysis for nCino.

While nCino’s recent analyst upgrades reflect optimism around business momentum and global expansion, the stock is still working to recover after a challenging stretch. Despite the fresh catalyst of a new Spanish partnership and ongoing adoption of its automation technology, nCino’s share price is down 25.6% year to date, and its total shareholder return over the past year sits at -32.8%. The current rally hints that sentiment may be turning. However, the company’s multi-year returns remind investors that long-term momentum is still a work in progress.

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With analyst upgrades citing attractive entry points after a steep price drop, the question now is whether nCino is truly undervalued or if the market has already factored in its future growth potential. Could this be a real buying opportunity?

Most Popular Narrative: 30.1% Undervalued

The prevailing narrative sees nCino’s fair value at $35.54 per share, which is well above its last close of $24.85. This sets up a compelling gap worth investigating. This view is driving renewed interest as investors debate whether growth catalysts can justify such a premium.

Expanding the nCino platform’s capabilities beyond core loan origination into onboarding, analytics, commercial pricing, and incentive compensation provides robust cross-sell and up-sell opportunities, increasing average contract value and driving both top line revenue and margin expansion over time.

Read the complete narrative.

Want to know which financial lever turns this ambitious valuation into reality? This narrative hinges on a bold turnaround in profitability and a revenue growth trajectory that few software peers can promise. Curious about which future earnings numbers support such a high price target? The full story has the surprises.

Result: Fair Value of $35.54 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, intensifying competition from global cloud giants and slower than expected international adoption could quickly challenge this optimistic outlook for nCino.

Find out about the key risks to this nCino narrative.

Another View: Multiples Raise Questions

While the narrative approach points to significant upside, the market's go-to valuation ratio tells a different story. At 5 times sales, nCino is priced above the fair ratio of 3.4 and exactly in line with the broader US software industry, but well below the peer average of 8. This signals the stock could be more expensive than the fundamentals justify, or perhaps the market sees hidden potential. Should investors trust the narrative or favor the discipline of numbers?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own nCino Narrative

If you see things differently or want to chart your own path, our platform lets you assemble your own nCino story in just minutes. Do it your way.

A great starting point for your nCino research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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