NCR CORP. (New York symbol NCR; www.ncr.com) is a leading maker of automated teller machines (ATMs), checkout scanners, cash registers and self-serve kiosks.
In February 2013, the company paid $791 million for Israel-based Retalix, whose software helps retailers manage their sales and track inventories. Retailers with a combined 70,000 locations in over 50 countries use Retalix’s products. NCR feels Retalix’s expertise will improve its point-of-sale terminals and self-serve kiosks.
In the three months ended March 31, 2013, Retalix contributed $50 million to NCR’s revenue. That helped push up the total by 13.3% in the latest quarter, to $1.4 billion from $1.2 billion a year earlier. The acquisition should add $255 million to the company’s full-year revenue.
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Stock investing: Banks may be in better position to spend more money on ATMs
Without unusual items, such as costs to integrate Retalix, earnings rose 27.7%, to $129 million from $101 million. Earnings per share rose 14.9%, to $0.54 from $0.47, on more shares outstanding. NCR borrowed most of the cash it needed to buy Retalix.
That borrowing increased its long-term debt to $2.0 billion, which is still a manageable 37% of its market cap. The company also holds cash of $483 million, or $2.94 a share.
NCR now expects to earn $2.70 to $2.80 a share for all of 2013, up from its earlier forecast of $2.65 to $2.75. The stock trades at just 12.0 times the midpoint of the new range.
In the latest edition of Wall Street Stock Forecaster, we look at NCR’s prospects in its competitive but growing field. We conclude with our clear buy-hold-sell advice on the stock.
(Note: If you are a current subscriber to Wall Street Stock Forecaster, please click here to view Pat’s recommendation. Be sure to log in first.)
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First, the ATM made a big change in the way people did their banking. Then, online banking took away some of the functions of the ATM. Can you foresee a day when all banking will be done online? Do you see a way in which cash could be bypassed altogether? Let us know what you think.
