NCR Atleos Corp Coverage Initiated by Compass Point

Investing.com — Compass Point has started coverage of NCR (NYSE: VYX) Atleos Corp (NYSE: NATL) with a "buy" rating and a price target of $57. This recommendation stems from the company’s strong free cash flow growth, its market leadership in the ATM sector, and its undervaluation compared to peers.

Key Highlights:

• Forecasted Free Cash Flow (FCF): $418 million for 2026, suggesting a market capitalization-to-cash flow multiple of 10 times, indicating a potential 74% upside from current levels.
• ATM Market Share: NCR holds a 36% share of the ATM market, showing strong positioning to leverage the increasing demand for managed and ATM-as-a-service products.
• Revenue Growth: Average revenue per unit in the Self-Service Banking (SSB) segment is set to increase from $5.1 in 2024 to $5.9 in 2026.
• Return on Invested Capital: Expected to improve from 6.3% in 2024 to 11.9% in 2026.
• Valuation: The company trades at a 10% discount compared to peers like Euronet Worldwide (NASDAQ: EEFT) and Diebold Nixdorf (OTC: DBDQQ), suggesting potential for premium valuation due to its focus on cash flow growth and profitability.
• Share Buyback Plan: Potential for a share buyback plan as early as mid-2025 could further boost shares.

In summary, Compass Point sees significant growth and investment potential in NCR Atleos Corp based on its financial metrics and market position.