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On Monday, Jefferies analyst Surinder Thind upgraded SS&C Technologies Holdings, Inc. (NASDAQ: NASDAQ:SSNC) from Hold to Buy, significantly raising the price target from $70.00 to $94.00. The upgrade reflects a positive outlook on the company’s future performance, with the analyst citing several key factors contributing to the decision.
SS&C Technologies, a provider of specialized financial software and services, is recognized for reaching a pivotal stage in its business trajectory. According to Thind, years of investment have positioned the company to sustain mid-single-digit organic growth. Moreover, SS&C is anticipated to return to 40% adjusted EBITDA margins, a benchmark for the company’s profitability and operational efficiency.
The analyst’s optimism is further supported by improving conditions in the capital markets. This uptrend is expected to benefit SS&C’s Intralinks, an enterprise platform for secure content sharing and collaboration. Additionally, a product refresh cycle is poised to enhance the performance of Blue Prism, SS&C’s robotic process automation offering.
Another significant point of interest for Jefferies is the potential for new customer acquisitions. The analyst believes that recent investments in DomaniRx, SS&C’s pharmacy management system, could lead to new customer wins. These developments are seen as a validation of the company’s strategic investments and management’s efforts to drive growth.
The revised price target of $94.00 represents a substantial increase from the previous target of $70.00. This adjustment indicates Jefferies’ confidence in SS&C Technologies’ ability to outperform expectations and deliver value to shareholders. The upgrade to a Buy rating suggests that Jefferies sees SS&C as an attractive investment opportunity in the financial technology sector.
In other recent news, SS&C Technologies has made significant strides in both their software offerings and financial performance. The company recently unveiled software-as-a-service (SaaS) updates aimed at improving efficiency in credit, derivatives, and investor accounting management for alternative investment managers. This includes enhancements to platforms such as Geneva, OEMS, and Eclipse.
In terms of financial performance, SS&C Technologies reported a record adjusted revenue of $1,466.8 million in its third-quarter earnings call, a 7.3% increase from the previous year. The company also saw a 10.3% rise in adjusted diluted earnings per share to $1.29, and a notable 39% increase in operating cash flow, amounting to $336.6 million for the quarter.
In partnership news, SS&C Technologies has renewed its contract with Omnis Investments Limited, a U.K. asset manager overseeing more than GBP10 billion. This continued relationship will support Omnis’s suite of mutual funds.
RBC Capital Markets has also recognized SS&C Technologies as one of its top five investment ideas for fiscal year 2025, alongside Fiserv (NYSE:FI), FIS, PayPal (NASDAQ:PYPL), and Block. These recent developments underscore SS&C Technologies’ commitment to growth and digital expansion.
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