NICE
NICE
shares have lost 31.9% year to date despite reporting impressive first-quarter 2022 results that benefited from a strong product portfolio and an expanding partner base.
NICE shares have suffered from pessimism surrounding the prospects of Internet-based stocks as economies started reopening after coronavirus-induced lockdowns and restrictions were lifted globally. Macro-economic challenges, including rising inflation and the Russia-Ukraine conflict, have been major headwinds.
Nevertheless, NICE shares have outperformed the Zacks
Internet Software
industry, which declined 44.8% over the same time frame. The outperformance can be attributed to strong demand for its cloud-based solutions.
In first-quarter 2022, Cloud revenues (55.9% of revenues) increased 29.2% year over year to $294.6 million. Financial Crime & Compliance revenues increased 20% year over year to $106 million.
NICE’s platforms like Actimize, Inform Elite, Robotic Process Automation and Investigate have been gaining traction in recent times. Actimize, in particular, has been winning customers frequently.
NICE recently announced that Texas-based financial institution, American State Bank, has selected its Actimize Xceed, an all-in-one AI fraud and anti-money laundering platform. The platform will help drive American State Bank’s restructured financial crime strategy.
Actimize and its portfolio of financial crime solutions, which includes anti-money laundering, holistic conduct surveillance, and other advanced risk and compliance solutions, has been named the category winner for “Best Solution for Managing Financial Crime” in A-Team Group’s 2022 Europe RegTech Insight Awards for the fifth consecutive year.
Global advisory and consulting firm, Quadrant Knowledge Solutions, ranked NICE Actimize as a top-performing Know Your Customer/Customer Due Diligence (KYC/CDD) Technology Leader in its recently released SPARK Matrix: Know Your Customer (KYC) Solution, 2022 report.
The introduction of advanced, X-Sight Entity Risk SaaS financial crime solution, powered by AI, machine learning, entity resolution and network analytics, is expected to further drive adoption. X-Sight Entity Risk enhances the efficacy of advanced anti-money laundering, enterprise fraud prevention and other financial services’ applications.
Expanding Partner Base to Drive Growth
NICE’s expanding partner base, which includes the likes of Deutsche Telekom Global Business,
Alphabet
GOOGL
, IBM and
Zoom
ZM
, bodes well for the company’s prospects.
Under the terms of the NICE-Alphabet partnership, NICE’s CXone was integrated with Alphabet’s cloud platform, Google Cloud’s Contact Center Artificial Intelligence applications to make self-service bots and agent-facing virtual assistants more effective.
NICE recently expanded its partnership with Google, adding CXone to Google’s Chrome Enterprise Recommended program.
In March, NICE announced that its next-generation NTR-X solution is available for compliance recording capture for communications via Zoom, including Zoom Meetings and Zoom Phone. NICE has collaborated with Zoom to create and utilize new APIs for financial markets’ compliance recording.
2022 Guidance Raised
For 2022, NICE now expects revenues between $2.16 billion and $2.18 billion (up from previous guidance range of $2.140 – $2.160 billion), representing 13% growth (up from 12%) at the midpoint from the figure reported in the previous year.
This Zacks Rank #3 (Hold) company now expects earnings between $7.25 and $7.45 per share (up from the previous guidance range of $7.07-$7.27 per share), representing 13% growth at midpoint from the figure reported in the previous year.
The Zacks Consensus Estimate for 2022 earnings, pegged at $7.36 per share, has increased 2.5% over the past 30 days. The consensus mark for revenues stands at $2.17 billion, indicating 12.75% growth from the figure reported in the previous year.
Revenues for the second quarter of 2022 are expected between $520 million and $530 million. Earnings are expected in the $1.75-$1.85 per-share range.
The Zacks Consensus Estimate for second-quarter of 2022 earnings is pegged at $1.78 per share, up 3.5% over the past 30 days. The consensus mark for revenues stands at $522.97 million, indicating 13.97% growth from the figure reported in the previous year.
A Stock to Buy Right Now
Although NICE holds promise,
Aspen Technology
AZPN
, from the same industry, is a better-ranked stock to buy right now.
AZPN sports a Zacks Rank #1 (Strong Buy). You can see
the complete list of today’s Zacks #1 Rank stocks here
.
Aspen shares have returned 35.8% year to date.
Profiting from the Metaverse, The 3rd Internet Boom (Free Report):
Get Zacks’ special report revealing top profit plays for the internet’s next evolution. Early investors still have time to get in near the “ground floor” of this $30 trillion opportunity. You’ll discover 5 surprising stocks to help you cash in.
Download the report FREE today >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report