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Coupa Completes Acquisition of Spend360 International

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Coupa Software Inc. recently completed the acquisition of U.K based Spend360 International for an undisclosed amount. Spend360 is a well known name in the spend analytics solution space with more than 400 global customers. The acquisition is not expected to materially impact Coupa’s fourth-quarter fiscal 2017 results.

Since commencing operations in 2011, Spend360 has processed spend data worth more than $1 trillion. The company’s solution uses deep machine learning to classify and normalize data in a suitable format that can actually be used by finance and procurement departments in running the business.

As compared to traditional spend analytics solution providers who rely on human intervention, Spend360’s solution aids in saving costs and lower risks in supplier base, which improves operational efficiency.

Acquisition to Expand Customer Base

Coupa provides a unified, cloud-based spend management platform that connects more than 460 organizations with above 2 million suppliers globally. The company’s platform helps enterprises keep a tab of daily expenditures.

Per Techcrunch, the company claims to have saved almost $8 billion for its customers, which includes the likes of Molina Healthcare (MOH - Free Report) , FedEx, Toyota of Puerto Rico, Nasdaq, CityFibre Holdings, Jive Communications and DBS Bank and Staples.

We believe that the inclusion of Spend360’s analytics solution into Coupa’s platform will further enhance capability of the spend management platform that will eventually expand customer base.

During third-quarter fiscal 2017, Coupa along with its partners won orders from Anheuser-Busch InBev (BUD - Free Report) , Lear Corporation, Frontier Airlines, Huntington Bank and Cooper Standard. Recently, DiDi Chuxing, the largest ride-sharing company in China became a customer of the company.
 

COUPA SOFTWARE Price and Consensus

 

COUPA SOFTWARE Price and Consensus | COUPA SOFTWARE Quote

The growing customer base will help Coupa to achieve its fiscal 2017 revenue forecasts, which are expected to be between $131.3 and $131.8 million. For fourth-quarter fiscal 2017, revenues are anticipated to be in the range of $35.5–$36 million.

Share Price Movement

Since its Initial Public Offering (IPO) on Oct 6, 2016, Coupa has underperformed the Zacks Internet Software industry. While the industry lost 6.32%, the company’s shares have declined 25.48% over the same period.

However, we expect expanding product portfolio including the newly launched Coupa Release 16 coupled with the addition of Spend360 will help the stock rebound in fiscal 2018.



Currently, Coupa carries a Zacks Rank #2 (Buy). MiX Telematics is a better-ranked stock sporting a Zacks Rank #1 (Strong Buy) in the same sector. You can see the complete list of today’s Zacks #1 Rank stocks here.

Current year estimates for MiX has remained steady at 28 cents per share in the last 30 days.

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