Craig-Hallum bullish on Crexendo, initiates with a Buy

As previously reported, Craig-Hallum initiated coverage of Crexendo (CXDO) with a Buy rating and $8 price target The firm believes that disruption in the UCaaS market has created a very attractive opportunity for Crexendo and looks specifically for Crexendo’s NetSapiens platform to take share from Metaswitch and Broadsoft, which are the two largest players in the market, and both have announced end of life, layoffs and/or forced migrations. Craig-Hallum thinks that reasonable penetration of what it estimates to be a $500M-plus opportunity could give material upside to estimates and highlights the company’s advantaged pricing structure, open-platform design, and leveraging of OCI as reasons that the company can win new customers in the years ahead. The firm further believes the recent selloff has created an attractive opportunity given the secular growth opportunity.