Domo signs strategic collaboration agreement with AWS for AI solutions
On Wednesday, Piper Sandler reaffirmed a Neutral stock rating for nCino Inc. (NASDAQ:NCNO), alongside a consistent price target of $25.00. The stock currently trades at $25.81, with InvestingPro analysis indicating the company is slightly overvalued based on its Fair Value metrics. The evaluation by the research firm highlighted nCino’s recent Investor Day revelations, which showcased the company’s expanding product range, the introduction of new agents, and the opportunities for cross-selling within its extensive customer base, which includes more than 2,700 clients. The firm’s analysis suggests that nCino’s current commercial and consumer cross-sell penetration, which stands at approximately 30% and less than 15% respectively, presents a significant medium-term growth opportunity. Financial data from InvestingPro shows the company achieved 13.45% revenue growth in the last twelve months, with revenue reaching $540.66 million.
The research commentary pointed out nCino’s accelerated innovation pace, particularly in developing AI capabilities specifically designed for the banking sector. This focus on technological advancement is expected to further cement nCino’s status as a premier end-to-end banking platform. Despite these positive developments, Piper Sandler expressed caution, opting to maintain the current stock rating until further evidence of execution can be observed.
The preliminary Q1 results indicated that nCino is on track to surpass the higher end of its total revenue, subscription, and operating income forecasts. While not currently profitable, InvestingPro analysis suggests net income is expected to grow this year. Piper Sandler is looking for additional proof points that could rebuild investor confidence and signal a potential rebound in growth for the company. The firm anticipates more definitive insights during the upcoming Q1 earnings call scheduled for May 28, which could potentially influence future evaluations of nCino’s stock. Investors can access comprehensive analysis and 8 additional ProTips about nCino through InvestingPro’s detailed research reports.
In other recent news, nCino Inc. announced preliminary first-quarter financial results that surpassed its own guidance, with total revenues, subscription revenues, and non-GAAP operating income exceeding expectations. The company is set to release detailed financial results later this month. Additionally, nCino has partnered with fintech company Pinwheel to integrate direct deposit switching technology into its Consumer Banking Solution, aiming to enhance deposit switch conversion rates. This partnership is expected to simplify the process for banks and credit unions, potentially increasing account activation success.
KeyBanc Capital Markets maintained its Sector Weight rating on nCino following an Investor Day event that highlighted a strategic shift towards artificial intelligence in product offerings. Despite a positive financial preannouncement, KeyBanc remains cautious, awaiting further evidence of successful execution. Meanwhile, Keefe, Bruyette & Woods reiterated an Outperform rating with a $28 price target, citing confidence in nCino’s growth strategies, including expanding its European presence and entering the credit union market. The firm anticipates that these strategies could drive sustainable long-term growth.
nCino’s management has expressed optimism about achieving a rule of 40 by FY2027, a metric combining growth rate and profit margins. The company’s recent developments, including the partnership with Pinwheel and strategic growth initiatives, suggest a focus on enhancing operational efficiency and customer experience. Investors are closely watching nCino’s progress as it implements these initiatives and aims to meet its financial goals.
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