Already a Bloomberg.com user?
Sign in with the same account.
Needham upgraded its investment recommendation on Nuance Communications (NUAN
) to buy from hold, explaining that the software company has reported three good quarters in a row after digesting acquisitions.
Analyst Richard Davis noted the revenue growth rate in Nuance's speech recognition software business, which was up about 35% year over year. For the first time, in 2006, the speech side of Nuance's business will be a greater contributor to revenue than its scanning software business. Davis thinks Nuance could see revenue and earnings per share growth of 20% and 25%, respectively for the next couple of years. He also sees 29 cents 2006 earnings per share and has a $7.50 price target on the stock.