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Investing.com - Rosenblatt lowered its price target on Verint Systems (NASDAQ:VRNT) to $20.50 from $40.00 on Monday, while maintaining a Neutral rating on the stock. The customer experience automation company, with a market capitalization of $1.22 billion and annual revenue of $896 million, is currently trading at $20.23. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value metrics.
The price target adjustment follows Thoma Bravo’s announcement of its intent to acquire Verint at a total enterprise value of $2 billion, representing approximately a 1% premium to the closing price on Friday, August 22, and an 18% premium to the stock price prior to the first market rumors. InvestingPro data shows the company maintains a healthy gross profit margin of 71.13%, though its current ratio of 0.64 indicates some liquidity challenges. Get access to 10+ additional ProTips and comprehensive analysis with InvestingPro.
Under the acquisition terms, Verint will merge with Calabrio to establish a market leadership position in the customer experience automation sector, with Verint shareholders receiving $20.50 per share in cash at closing.
The acquisition is expected to close before Verint’s fiscal year-end in January, and the company has suspended all future earnings calls pending completion of the transaction.
Rosenblatt believes the acquisition will proceed as planned, prompting the firm to adjust its price target to match the acquisition offer price of $20.50 per share.
In other recent news, Verint Systems Inc. announced it will be acquired by Thoma Bravo in an all-cash transaction valued at $2 billion. This agreement will see Verint shareholders receiving $20.50 per share, which represents an 18% premium to the company’s 10-day volume weighted average share price before the news broke. Prior to this announcement, there were reports that Verint was in discussions with Thoma Bravo, which led to a rise in Verint’s stock. Evercore ISI maintained its "In Line" rating on Verint, setting a price target of $23.00, although the firm noted that any discussions were speculative at the time.
Additionally, it was reported that Verint had hired bankers to explore a potential sale amid concerns over AI disruption in the customer service industry. This move was seen as a response to how AI could transform sectors like call centers, potentially replacing human representatives. Despite these developments, Verint declined to comment on the reported talks with Thoma Bravo. The acquisition by Thoma Bravo is expected to close soon, pending regulatory approvals and customary closing conditions.
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