What Analysts Are Saying About Cerence Stock

Analysts' ratings for Cerence CRNC over the last quarter vary from bullish to bearish, as provided by 4 analysts.

The following table provides a quick overview of their recent ratings, highlighting the changing sentiments over the past 30 days and comparing them to the preceding months.

In the assessment of 12-month price targets, analysts unveil insights for Cerence, presenting an average target of $5.0, a high estimate of $6.00, and a low estimate of $3.00. Highlighting a 51.22% decrease, the current average has fallen from the previous average price target of $10.25.

Breaking Down Analyst Ratings: A Detailed Examination

A comprehensive examination of how financial experts perceive Cerence is derived from recent analyst actions. The following is a detailed summary of key analysts, their recent evaluations, and adjustments to ratings and price targets.

Key Insights:

• Action Taken: In response to dynamic market conditions and company performance, analysts update their recommendations. Whether they 'Maintain', 'Raise', or 'Lower' their stance, it signifies their reaction to recent developments related to Cerence. This insight gives a snapshot of analysts' perspectives on the current state of the company.
• Rating: Providing a comprehensive analysis, analysts offer qualitative assessments, ranging from 'Outperform' to 'Underperform'. These ratings reflect expectations for the relative performance of Cerence compared to the broader market.
• Price Targets: Analysts gauge the dynamics of price targets, providing estimates for the future value of Cerence's stock. This comparison reveals trends in analysts' expectations over time.

Analyzing these analyst evaluations alongside relevant financial metrics can provide a comprehensive view of Cerence's market position. Stay informed and make data-driven decisions with the assistance of our Ratings Table.

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Unveiling the Story Behind Cerence

Cerence Inc is a United States-based software company. It is involved in developing mobility-based solutions for drivers and their cars. The customers include all automobile original equipment manufacturers, or OEMs, or their tier 1 suppliers. The company's revenue is generated by selling software licenses and cloud-connected services. Geographically, it derives a majority of its revenue from the United States and also has a presence in Other Americas; Germany; Other Europe, the Middle East, Africa; Japan, and Other Asia-Pacific.

Unraveling the Financial Story of Cerence

Market Capitalization Analysis: Below industry benchmarks, the company's market capitalization reflects a smaller scale relative to peers. This could be attributed to factors such as growth expectations or operational capacity.

Decline in Revenue: Over the 3 months period, Cerence faced challenges, resulting in a decline of approximately -0.83% in revenue growth as of 31 March, 2024. This signifies a reduction in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Information Technology sector.

Net Margin: Cerence's net margin is below industry standards, pointing towards difficulties in achieving strong profitability. With a net margin of -409.84%, the company may encounter challenges in effective cost control.

Return on Equity (ROE): Cerence's ROE falls below industry averages, indicating challenges in efficiently using equity capital. With an ROE of -46.54%, the company may face hurdles in generating optimal returns for shareholders.

Return on Assets (ROA): The company's ROA is below industry benchmarks, signaling potential difficulties in efficiently utilizing assets. With an ROA of -24.69%, the company may need to address challenges in generating satisfactory returns from its assets.

Debt Management: Cerence's debt-to-equity ratio is below the industry average. With a ratio of 0.63, the company relies less on debt financing, maintaining a healthier balance between debt and equity, which can be viewed positively by investors.

Analyst Ratings: Simplified

Analysts are specialists within banking and financial systems that typically report for specific stocks or within defined sectors. These people research company financial statements, sit in conference calls and meetings, and speak with relevant insiders to determine what are known as analyst ratings for stocks. Typically, analysts will rate each stock once a quarter.

Analysts may supplement their ratings with predictions for metrics like growth estimates, earnings, and revenue, offering investors a more comprehensive outlook. However, investors should be mindful that analysts, like any human, can have subjective perspectives influencing their forecasts.

This article was generated by Benzinga's automated content engine and reviewed by an editor.