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Bernstein: Teradata Positioned To Expand Recurring Revenue Growth

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Bernstein: Teradata Positioned To Expand Recurring Revenue Growth

Data company Teradata Corporation (NYSE: TDC)’s new subscription and rental offerings are likely to drive strong annual recurring revenue growth through 2020, according to Bernstein. 

The Analyst

Zane Chrane of Bernstein upgraded Teradata shares from Underperform to Market-Perform and raised the stock’s price target from $33 to $39.

The Thesis

New subscription offerings are likely to grow the portion of Teradata’s revenue that is recurring and lead to sustainable and consistent revenue streams over the long run, Chrane said in a Monday note. 

“We forecast Teradata can grow total [annual recurring revenue] at a 9-percent CAGR through fiscal 2020, driven largely by growth in the company's new subscription/rental offerings," the analyst said. 

Tetradata is also positioned to capture upside from increased market-wide capital expenditures spending, which is expected to grow at nearly 5 percent in 2018 and primarily trickle toward modernizing IT and cloud initiatives, Chrane said. 

Price Action

Tetradata shares were up more than 6 percent at $41.56 late in Monday's trading session. 

Related Links:

Morgan Stanley Swings From Cautious To Bullish On IT Hardware

Why Oracle Expects 2018 To Be The Cloud Sales 'Tipping Point'

Latest Ratings for TDC

DateFirmActionFromTo
Feb 2020Cowen & Co.MaintainsMarket Perform
Nov 2019Morgan StanleyMaintainsOverweight
Nov 2019Wells FargoMaintainsUnderperform

View More Analyst Ratings for TDC
View the Latest Analyst Ratings

Posted-In: Bernstein big data Zane ChraneAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga

 

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