Lightspeed (LSPD) has completed the acquisition of NuORDER, a digital platform focused on connecting suppliers and businesses. The one-stop commerce platform finalized the purchase for about $206.9 million in cash, along with the issuance of 2.14 million Lightspeed subordinate voting shares.
Some NuORDER employees stand to receive 500,629 subordinate voting shares of Lightspeed over the next three years. The issuance of the additional shares is dependent on the attainment of certain milestones.
The acquisition should result in the creation of a global distribution network for leading brands. It should also enhance the product ordering process for retailers and provide suppliers with insights into how their products move. (See Lightspeed stock chart on TipRanks)
More than 3,000 brands are currently using the NuORDER platform. In the 12 months ended March 31, 2021, thousands of retailers had processed more than $11.5 billion in orders through its platform, leading to over $20 million in revenue. The company also grew by more than 30% during the period.
In May, Morgan Stanley analyst Josh Baer reiterated a Hold rating on Lightspeed but raised his price target to $80 from $79, implying 7.7% downside potential to current levels. The price target increase came on the back of the company’s management announcing a 50% year-over-year increase in website traffic in the U.S., which is helping it drive more cost-effective lead generation.
“Excluding all of the M&A, customer additions, and increasing attach of Lightspeed payments, customers are spending more on software subscriptions per location, an important trend and core growth vector for Lightspeed as merchants adopt more modules from Lightspeed. ARPU per location including transaction-based revenue grew 48% YoY,” Baer said.
Consensus among analysts is a Strong Buy based on 8 Buys and 2 Holds. The average Lightspeed price target of $94.32 implies 8.8% upside potential to current levels.
LSPD scores a 9 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
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