NasdaqGS:NUAN

Stock Analysis Report

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Market Cap

US$15.7b

Last Updated

2021/06/13 23:28 UTC

Data Sources

Company Financials +

Executive Summary

Nuance Communications, Inc. provides conversational and cognitive artificial intelligence (AI) innovations that bring intelligence to everyday work and life. More Details


Snowflake Analysis

Reasonable growth potential with proven track record.


Similar Companies

Share Price & News

How has Nuance Communications's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NUAN is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: NUAN's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

0.09%

NUAN

3.5%

US Software

0.8%

US Market


1 Year Return

142.7%

NUAN

41.2%

US Software

44.4%

US Market

Return vs Industry: NUAN exceeded the US Software industry which returned 41.2% over the past year.

Return vs Market: NUAN exceeded the US Market which returned 44.3% over the past year.


Shareholder returns

NUANIndustryMarket
7 Day0.09%3.5%0.8%
30 Day4.5%7.4%3.0%
90 Day22.1%7.6%4.4%
1 Year142.7%142.7%42.1%41.2%46.7%44.4%
3 Year340.0%282.5%128.2%121.6%60.3%50.4%
5 Year294.4%242.9%326.7%304.2%128.3%102.8%

Long-Term Price Volatility Vs. Market

How volatile is Nuance Communications's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Nuance Communications undervalued compared to its fair value and its price relative to the market?

496.61x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: NUAN ($54.93) is trading above our estimate of fair value ($22.48)

Significantly Below Fair Value: NUAN is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: NUAN is poor value based on its PE Ratio (496.6x) compared to the US Software industry average (48.3x).

PE vs Market: NUAN is poor value based on its PE Ratio (496.6x) compared to the US market (19.7x).


Price to Earnings Growth Ratio

PEG Ratio: NUAN is poor value based on its PEG Ratio (9.1x)


Price to Book Ratio

PB vs Industry: NUAN is overvalued based on its PB Ratio (14x) compared to the US Software industry average (7.9x).


Future Growth

How is Nuance Communications forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

54.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NUAN's forecast earnings growth (54.8% per year) is above the savings rate (2%).

Earnings vs Market: NUAN's earnings (54.8% per year) are forecast to grow faster than the US market (15.5% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: NUAN's revenue (7.7% per year) is forecast to grow slower than the US market (9.3% per year).

High Growth Revenue: NUAN's revenue (7.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NUAN's Return on Equity is forecast to be high in 3 years time (23.8%)


Past Performance

How has Nuance Communications performed over the past 5 years?

25.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NUAN has a large one-off loss of $13.6M impacting its March 31 2021 financial results.

Growing Profit Margin: NUAN's current net profit margins (2.1%) are higher than last year (1.3%).


Past Earnings Growth Analysis

Earnings Trend: NUAN has become profitable over the past 5 years, growing earnings by 25.1% per year.

Accelerating Growth: NUAN's earnings growth over the past year (61%) exceeds its 5-year average (25.1% per year).

Earnings vs Industry: NUAN earnings growth over the past year (61%) exceeded the Software industry 30.1%.


Return on Equity

High ROE: NUAN's Return on Equity (2.8%) is considered low.


Financial Health

How is Nuance Communications's financial position?


Financial Position Analysis

Short Term Liabilities: NUAN's short term assets ($782.6M) do not cover its short term liabilities ($1.6B).

Long Term Liabilities: NUAN's short term assets ($782.6M) do not cover its long term liabilities ($885.8M).


Debt to Equity History and Analysis

Debt Level: NUAN's debt to equity ratio (139%) is considered high.

Reducing Debt: NUAN's debt to equity ratio has increased from 125.9% to 139% over the past 5 years.

Debt Coverage: NUAN's debt is not well covered by operating cash flow (16.8%).

Interest Coverage: NUAN's interest payments on its debt are not well covered by EBIT (1.7x coverage).


Balance Sheet


Dividend

What is Nuance Communications's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate NUAN's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate NUAN's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if NUAN's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if NUAN's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of NUAN's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.7yrs

Average management tenure


CEO

Mark Benjamin (49 yo)

3.17yrs

Tenure

US$12,179,007

Compensation

Mr. Mark D. Benjamin has been Chief Executive Officer and Director of Nuance Communications, Inc. since April 23, 2018. With extensive experience serving technology markets, Mr. Benjamin has a proven track...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD12.18M) is about average for companies of similar size in the US market ($USD11.17M).

Compensation vs Earnings: Mark's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: NUAN's management team is considered experienced (2.7 years average tenure).


Board Members

Experienced Board: NUAN's board of directors are considered experienced (3.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: NUAN insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Nuance Communications, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Nuance Communications, Inc.
  • Ticker: NUAN
  • Exchange: NasdaqGS
  • Founded: 1992
  • Industry: Application Software
  • Sector: Software
  • Market Cap: US$15.715b
  • Shares outstanding: 286.09m
  • Website: https://www.nuance.com

Number of Employees


Location

  • Nuance Communications, Inc.
  • 1 Wayside Road
  • Burlington
  • Massachusetts
  • 1803
  • United States

Listings


Biography

Nuance Communications, Inc. provides conversational and cognitive artificial intelligence (AI) innovations that bring intelligence to everyday work and life. The company delivers solutions that understand,...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/06/13 23:28
End of Day Share Price2021/06/11 00:00
Earnings2021/03/31
Annual Earnings2020/09/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.