) is actively acquiring companies as a growth strategy. True to
that, NCR has acquired video banking software provider uGenius
Technology. This is a strategic move by the company as NCR is
looking to enhance its video ATM technology.
The acquisition will boost NCR's APTRA Interactive Teller
solution. This Interactive Teller operates through two-way video
conferencing and enables remote transaction processing. The
video-based interactive technology helps customers to complete
banking transactions through centrally-based tellers that have
control of the teller machines. NCR expects this technology
to be adopted by several of the top 10 U.S. banks during the
first half of 2013.
During 2011, NCR and uGenius had partnered to install the
first multi-function ATM with a live teller following which it
acquired a small stake in the company in January 2012.
NCR has always been on the lookout for acquisitions. In
December 2012, the company announced the acquisition of retail
software and services company Retalix Ltd. for $30.00 per share
in cash, totaling approximately $650 million. Through this
acquisition, NCR was able to adopt a hardware-enabled,
software-driven business model. NCR intends to shift its business
mix to increase focus on the higher-margin software and services
The Radiant Systems acquisition has also been making a
meaningful contribution. NCR reported decent third quarter
results, with revenues improving across most of its business
segments and geographical regions, and EPS exceeding our
expectations. Higher volumes and cost savings also led to a
stronger gross margin.
The company has also provided a decent guidance for the next
fiscal year. We believe that it is well positioned to deliver
good momentum across all its businesses. Of course, the debt
position appears high and competition remains stiff, which are
Currently, both NCR and its arch-rival
) carry a Zacks #3 Rank (Hold).
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