Enghouse Systems Buys Altitude Software; Street is Bullish

Enghouse Systems Limited announced yesterday that it has acquired Lisbon-based Altitude Software.

Enghouse (ENGH) provides enterprise software solutions that are designed to transform contact centers, including remote work, into growth centers for global businesses. Its cloud-based technology enhances visual communications by connecting people around the world.

Altitude is a global provider of omnichannel solutions that help companies unify all customer interactions and become more customer focused. With over 300 customers world-wide, Altitude’s well-established customer base has driven its growth and enabled the company to achieve annual revenues of approximately $30 million.

“Altitude expands our presence in Latin countries, primarily in Spain, Brazil, Mexico and now Portugal, enabling us to capture additional opportunities within these markets,” said Steve Sadler, Chairman & CEO of Enghouse.

Alfredo Redondo, CEO of Altitude, echoed Sadler’s sentiments, highlighting the synergies between the two companies and the opportunity of expanding its product offerings to existing and new customers. (See ENGH stock analysis on TipRanks)

TD Securities analyst Daniel Chan reiterated his Buy rating on ENGH two days ago and set a price target of C$83. This implies upside potential of around 37%.

Chan questioned Sadler at an earnings conference call on December 18 about the decline in recurring hosting and maintenance revenue for the fourth quarter. Sadler explained that this was partly because two major recurring revenue customers in the travel and hospitality industries experienced some financial difficulties resulting from the coronavirus.

Overall, consensus among analysts is a Moderate Buy based on 4 Buy and 2 Hold ratings. The average price target of C$77.84 suggests upside potential of around 28% over the next 12 months.

ENGH shares have gained around 26% in value since the beginning of the year.