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Motorola Strengthens Public Safety Space With Callyo Buyout

Zacks Equity Research
·4 min read

In order to reinforce its position in the public-safety market, Motorola Solutions, Inc. MSI recently announced the acquisition of Callyo — a leading provider of advanced mobile technology for law enforcement purposes — for an undisclosed amount. Apparently, the state-of-the-art mobile applications from Callyo will help Motorola enhance its mission-critical communications infrastructure, while boosting productivity for seamless operations.

Based in St. Petersburg, FL, Callyo is a software-as-a-service company that develops cloud-based mobile applications to assist law enforcement entities promptly respond to critical situations. Established on the foundation of privacy-first technology, the company primarily serves customers based in North America with two application platforms — Callyo and 10-21. Callyo mainly offers investigative tools for digital evidence while 10-21 platform is leveraged to ease communications between first responders and communities. Some of its eminent public safety partners are Verizon Communications Inc. VZ, Sonim Technologies, Inc. SONM, Samsung and PenLink.

Notably, the latest buyout is likely to strengthen the critical mobile technology capabilities of Motorola’s command center software suite. The command center portfolio provides emergency call handling services, maximizes collaboration for safer incident resolutions and keeps everyone connected at all times through its seamless broadband connectivity. Callyo had previously collaborated with RapidSOS to create avant-garde technologies for public safety agencies. The transaction is expected to create a win-win solution for both the companies by augmenting Callyo’s market reach while boosting the mission-critical ecosystem of Motorola.

Lately, Motorola has been on a spree to acquire some major players in the public safety space. Few months back, the Chicago, IL-based company completed the acquisition of IndigoVision, a company which develops video security solutions. The buyout underscored Motorola’s investment in video security and analytics for competitive advantage and complemented IndigoVision’s products to enjoy greater go-to-market reach across a broader customer base. It also purchased companies like WatchGuard and VaaS International Holdings. Reportedly, the buyout of Callyo is considered to be Motorola’s sixth acquisition over a course of two years. Motorola’s enriched portfolio coupled with a healthy balance sheet provides a solid foundation to navigate this dynamic environment.

As a leading provider of mission-critical communication products and services worldwide, Motorola garnered a steady revenue stream from this niche market. The communications equipment maker intends to boost its position in the public safety domain by entering into strategic alliances with other players in the ecosystem. It projects robust demand across land mobile radio products, services and software, which ensures continuity and reduces risks related to critical communications operations. The company is poised to benefit from organic growth and acquisition initiatives, disciplined capital allocation as well as favorable macroeconomic climate. Its competitive position along with an attractive portfolio for large addressable market, bodes well.

Motorola has a long-term earnings growth expectation of 9%. The stock has gained 10.9% compared with the industry’s growth of 25.6% in the past three months.

Zacks Rank & Stocks to Consider

Motorola currently carries a Zacks Rank #2 (Buy).

Another top-ranked stock in the industry is Nokia Corporation NOK, carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Nokia has a trailing four-quarter earnings surprise of 37.5%, on average.

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