KeyBanc: LogMeIn Targets $41B Increase In Total Addressable Market
LogMeIn Inc (NASDAQ: LOGM), a provider of a cloud-based remote connectivity services, is in the early stages of a growth opportunity, and investors should take advantage of its valuation, according to KeyBanc Capital Markets.
The Analyst
KeyBanc's Alex Kurtz initiated coverage of LogMeIn's stock with an Overweight rating and $135 price target.
The Thesis
LogMeIn boasts more than 4 million daily active users among multiple product portfolio lines, Kurtz said in the initiation note. The company's recent acquisition of Jive gives it access to the Unified Communications-as-a-Service market, in which average revenue per user stands at $4,000, as opposed to LogMeIn's customers at $500, the analyst said.
LogMeIn has the necessary resources to drive adoption of its UCaaS portfolio among its already existing installed base, which should result in growth beyond current estimates of 5 to 7 percent, Kurtz said.
LogMeIn's acquisition of Jive is part of its strategy to broaden its established product portfolio to expand into adjacent markets that would increase its total addressable market from $5 billion to $46 billion, the analyst said. Kurtz highlighted some of LogMeIn's initiatives that are intended to increase its TAM ninefold:
Adding functionality to web conferencing products, a $2.9-billion market, which signals greater ambitions in the $25.5-billion unified communications and collaboration market.
Expanding functionality in IT support and device management, a $600-million market.
Products like LastPass target the $6.8-billion access management market.
LogMeIn is developing expertise in remote support and chat products, which represent a $1.3-billion market and are part of the broader, $13.8-billion contact center functionality market.
Price Action
Shares of LogMeIn were trading higher by 0.44 percent at the time of publication Friday morning.
Related Links:
11 Reasons To Like LogMeIn
EXCLUSIVE INTERVIEW: Jive Software CEO on M&A, Software Updates (JIVE)
Latest Ratings for LOGM
Apr 2018 | KeyBanc | Initiates Coverage On | Overweight | |
Apr 2018 | Mizuho | Initiates Coverage On | Buy | |
Oct 2017 | Barclays | Maintains | Overweight |
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