UPDATE: Deutsche Bank Initiates Model N with Buy on Market Leader Position

In a report published Monday, Deutsche Bank analyst Tom Ernst Jr. initiated coverage on Model N MODN with a Buy rating and $25.00 price target. In the report, Ernst noted, “Model N is the pioneer and market leader for revenue management solutions. Their solutions serve as the system of record for mission critical data, such as prices, quotes, contracts, incentives and rebate claims, which are typically not available in either CRM or ERP systems. They address a large addressable market of ~3000 customers, worth $5b in spending by 2020, with low penetration (3% of customers) today. We conservatively model high-teens revenue growth the next several years, and view their highly visible business model with good long-term margin leverage as attractive. Initiate with Buy and $25 PT.” Model N closed on Friday at $20.54.