Can CSG Systems Become A Billion Dollar Beacon In A Crowded Tech Market? Analyst Says Yes

Zinger Key Points
  • RBC Capital initiates coverage on CSGS with an Outperform rating and a $61 price target, optimistic about growth prospects.
  • Revenue management and digital monetization are identified as consistent, profitable segments for CSG.

RBC Capital Markets analyst Dan Bergstrom initiated coverage on CSG Systems International, Inc. CSGS with an Outperform rating and price target of $61.

The analyst is bullish on the company’s goal to accelerate growth and scale by growing the business to more than $1.5 billion by CY/25E.

The analyst says the company can consistently grow organically in the 2%-6% range and strategic M&As, leading to margin expansion and driving EPS growth faster than revenue. 

The analyst also sees revenue management and digital monetization as a recurring, profitable book of business.

Bergstrom writes that CSG is emerging as a partner of choice for brands in higher growth verticals to digitize and monetize customer experiences and payment processes. 

The analyst says that CSG should be in a better position upon contract renewals with major players and its wireless business.

The analyst estimates EPS of $3.91 in 2024 and $4.16 in 2025.

Investors can gain exposure to the stock via ProShares S&P Technology Dividend Aristocrats ETF TDV and ETF Series Solutions AAM Bahl & Gaynor Small/Mid Cap Income Growth ETF SMIG

Price Action: CSGS shares are up 0.10% at $50.35 on the last check Wednesday.

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