Cerence director Thomas Beaudoin sold $15,550 worth of stock Via Investing.com
BURLINGTON, MA—Thomas L. Beaudoin, director of Company Cerence Inc . (NASDAQ:), has sold 5,000 shares of the company’s common stock. The shares were traded at an average price of $3.11 each, which equates to a total transaction value of $15,550. Following this transaction, Beaudoin retains ownership of 201,054 shares in the company. The sale was made as part of a pre-arranged trading plan established under Rule 10b5-1 on December 21, 2023.
In other recent news, Cerence Inc. reported revenue for the third quarter of fiscal year 2024 of $70.5 million, marking a 14% year-over-year increase. Excluding a significant impairment charge of approximately $357 million, the company’s non-GAAP profit exceeded its guidance. The company’s full-year revenue is between $321 and $327 million, while Q4 revenue is estimated at $44-50 million.
Cerence has also undergone a major leadership change with the appointment of Brian Krzanich as the new CEO, succeeding Stefan Ortmanns. Krzanich, a veteran executive with a track record of driving growth at CDK Global (NASDAQ:) Inc. and Intel (NASDAQ: ), joins Cerence at a time when the company maintains its earnings forecast for the fourth quarter of 2024.
According to analyst estimates, Baird lowered the price target for Cerence from $6.00 to $5.00, maintaining an average rating. Similarly, TD Cowen revised its price target from $12.00 to $10.00, while giving the stock a buy rating. The changes follow Cerence’s announcement of a major restructuring plan, which is expected to yield savings of between $35 and $40 million.
Finally, Cerence is developing its generative AI and large-scale language modeling solutions, as well as developing a next-generation AI computing platform. These are the latest changes affecting Cerence Inc.
InvestingPro Insights
Thomas L. Beaudoin’s latest insider sale at Cerence Inc. (NASDAQ:CRNC) comes at a time when the company’s stock has experienced significant volatility. According to InvestingPro data, Cerence’s stock has picked up speed in the past week, with a 7.55% decrease in total return. This short-term dip is part of a larger trend, as the stock has fallen significantly over the past year, with a one-year price gain of -81.56%.
Despite these challenges, there are positive indicators for Cerence. InvestingPro Tip suggests that revenue is expected to grow this year, and analysts predict that the company will be profitable for the current fiscal year. This view is particularly noteworthy since Cerence has been unprofitable for the past twelve months.
The company’s valuation metrics paint a rosy picture. With a price-to-book ratio of 0.83 for the trailing twelve months ending Q3 2024, Cerence is trading below its book value. This may indicate that the stock is undervalued, especially considering InvestingPro’s Tip that valuation implies a strong free cash flow yield.
It is worth noting that Cerence has shown strong revenue growth, with an increase of 31.49% in the last twelve months ending in Q3 2024. The company’s gross profit margin stands at a healthy 74.78%, suggesting good performance despite challenging stock performance.
For investors who want a more comprehensive analysis, InvestingPro offers 12 additional Cerence tips, which provide a deeper understanding of the company’s financial health and market conditions.
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