Trade-Ideas: Nuance Communications (NUAN) Is Today's Post-Market Leader Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Nuance Communications ( NUAN) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Nuance Communications as such a stock due to the following factors:

  • NUAN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $62.5 million.
  • NUAN is up 4.2% today from today's close.

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More details on NUAN:

Nuance Communications, Inc. provides voice and language solutions for businesses and consumers worldwide. NUAN has a PE ratio of 174.1. Currently there are 6 analysts that rate Nuance Communications a buy, no analysts rate it a sell, and 9 rate it a hold.

The average volume for Nuance Communications has been 3.7 million shares per day over the past 30 days. Nuance has a market cap of $5.9 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.26 and a short float of 7% with 4.69 days to cover. Shares are down 14.2% year to date as of the close of trading on Friday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Nuance Communications as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:
  • NUAN's revenue growth has slightly outpaced the industry average of 5.9%. Since the same quarter one year prior, revenues slightly increased by 8.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • NUAN's debt-to-equity ratio of 0.88 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that NUAN's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.13 is high and demonstrates strong liquidity.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Software industry. The net income has significantly decreased by 144.1% when compared to the same quarter one year ago, falling from $79.26 million to -$34.97 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Software industry and the overall market, NUANCE COMMUNICATIONS INC's return on equity significantly trails that of both the industry average and the S&P 500.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

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