Analyst Michael Infante of Morgan Stanley maintained a Hold rating on nCino (NCNO – Research Report), retaining the price target of $39.00.
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Michael Infante’s rating is based on a combination of factors, primarily revolving around concerns about the management changes at nCino. The unexpected announcement of Sean Desmond as the new CEO, succeeding Pierre Naudé, has raised questions about leadership continuity, a concern that has been highlighted for some time. The recent departures of key executives, including the CFO, CRO, and CPO, further add to the worry about the stability of the management team.
Despite the potential for nCino to benefit from a more favorable regulatory environment and anticipated improvements in net interest income in the coming years, these management transitions cast uncertainty on the company’s future. Although the company’s strong profitability and free cash flow margins are promising, investor confidence in the new management’s ability to maintain or exceed mid-teens growth in organic subscription revenue remains uncertain. Thus, a Hold rating is recommended until clarity and stability in leadership are achieved.
Based on the recent corporate insider activity of 140 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of NCNO in relation to earlier this year.