Wednesday, December 4, 2013

Seeking Alpha: NCR Hits The Throttle On Its Transformation Plan

Short of a name change, it's likely going to take a long time before investors stop thinking of NCR (NCR) primarily as a manufacturer of ATMs and retail self check-out kiosks. After all, that's what we all see on a day to day basis when we go to the bank or a store. There's a great deal more to the story, though, as NCR has invested significantly in its services and software capabilities.

With the acquisitions of Digital Insight and Alaric Systems, announced on Monday evening, NCR has significantly accelerated that transition towards a service and software-oriented company. The deals are expensive in terms of multiples, but the potential from operating synergies, cross-selling, and addressable market expansion make them worthwhile. While there are areas of sluggishness in the financial and retail spaces that threaten near-term performance, I believe these shares of NCR remain meaningfully undervalued in a market that offers few of those opportunities.

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NCR Hits The Throttle On Its Transformation Plan

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