Northland Upgrades Textura To Outperform

Northland Capital Markets on Friday issued a company update on Textura Corp. (NYSE: TXTR) after evaluation of the company's domestic CPM business showed potential upside for the company's stock. Analysts at Northland upgraded Textura to Outperform with a $25 price target.

Analyst Jeff Houston wrote, "Textura's disruptive technology is modernizing the large and underpenetrated commercial construction industry. The company enjoys first mover advantage and pricing power...We are increasing our rating...primarily due to valuation and stability of Textura domestic CPM business...we think that there is more upside potential than downside risk."

Analysts at Northland highlighted two reasons why they see strength in Textura's business operations:

1. Growth in Textura's available market.

Northland believes that Textura's available market could increase from $3 billion to $20 billion in the next three to five years due to international expansion and further monetization. If Textura continues to introduce innovative products that address its key customer segment of subcontractors, the company has the opportunity to drive top-line growth and benefit from margin expansion due to strong pricing power and consumer demand.

2. Business Model Advantages

Analysts noted that Textura collects revenue in advance, which results in favorable cash flow and revenue visibility. With experienced management guiding the company's growth opportunities along with strong cash flow generation, analysts like Textura's business model and see the company as having the potential to accelerate growth.