nCino Inc

nCino, Inc. (NASDAQ: NCNO) is a global provider of cloud banking solutions for the global financial services industry. The Company offers nCino Bank Operating System, which is a single, multi-tenant software-as-a-service solution that connects financial institutions (FI) employees, their clients and third parties on a single, cloud-based platform, eliminating silos and bringing new levels of coordination and transparency to the FI. This platform provides all the functionality necessary to complete workflow, enabling client onboarding, loan origination, deposit account opening, analytics and compliance.

Recent Business and Financial Updates

• Third Quarter Fiscal Year 2025 Performance Overview: nCino, Inc., a leading provider of intelligent banking solutions, reported strong financial results for the third quarter of fiscal year 2025, ending October 31, 2024. Total revenues reached USD 138.8 million, representing a 14% increase from USD 121.9 million during the same period in fiscal year 2024. Subscription revenues also grew by 14%, rising to USD 119.9 million compared to USD 104.8 million in the prior year. These results highlight the company’s continued momentum in delivering value through its comprehensive banking platform.
• Profitability and Operating Metrics: The company demonstrated significant improvements in profitability, with non-GAAP operating income increasing by 38% year-over-year to USD 28.0 million. This resulted in a non-GAAP operating margin of 20%, a 350-basis-point improvement from the same quarter last year. Meanwhile, the GAAP operating loss was reduced to USD 0.8 million from USD 12.9 million in Q3 FY 2024. Non-GAAP net income attributable to nCino rose to USD 24.4 million, or USD 0.21 per diluted share, up from USD 16.2 million, or USD 0.14 per diluted share, in the prior year, showcasing the company’s ability to scale effectively and enhance profitability.
• Remaining Performance Obligation and Cash Position: The company’s Remaining Performance Obligation (RPO) increased by 19% year-over-year to USD 1.095 billion as of October 31, 2024. Of this amount, USD 730.0 million is expected to be recognized within the next 24 months, reflecting sustained demand for nCino’s solutions. Cash, cash equivalents, and restricted cash stood at USD 258.3 million as of October 31, 2024. This strong cash position supported strategic initiatives, including the acquisition of FullCircl, which was finalized in November 2024.
• Strategic Business Achievements: During the quarter, nCino continued to expand its global footprint through significant partnerships and deployments. Notable achievements included the acquisition of FullCircl, which enhanced the company’s onboarding capabilities with advanced data aggregation tools tailored for financial institutions in the EMEA region. Additionally, nCino secured key agreements, such as a multi-solution expansion with a top-40 U.S. bank and its first Banking Advisor deal in Australia. In Japan, Tokushima Taisho Bank became nCino’s largest customer in the region by adopting its solutions for business lending operations. The company also expanded its relationship with the largest bank in Norway to include ESG reporting and credit portfolio management while successfully implementing its Mortgage Solution for a major U.S. homebuilder.
• Guidance for Fourth Quarter and Fiscal Year 2025: Looking ahead, nCino provided guidance for the fourth quarter ending January 31, 2025, with expected total revenues between USD 139.5 million and USD 141.5 million and subscription revenues ranging from USD 122.5 million to USD 124.5 million. Non-GAAP operating income is projected to range between USD 23.25 million and USD 24.25 million, with non-GAAP net income per diluted share anticipated at USD 0.18 to USD 0.19. For the full fiscal year 2025, the company forecasts total revenues between USD 539.0 million and USD 541.0 million, subscription revenues between USD 467.0 million and USD 469.0 million, and non-GAAP net income per diluted share of USD 0.72 to USD 0.73. These projections underscore nCino’s confidence in sustaining its growth trajectory through innovation and operational excellence.
• Leadership Remarks and Strategic Outlook: Pierre Naudé, Chairman and CEO, praised the company’s strong execution and its ability to exceed expectations for both revenue and non-GAAP operating income during the quarter. He highlighted the success of over 30 multi-solution deals and increased bookings from new customers, reflecting the growing demand for nCino’s comprehensive banking platform. Naudé emphasized the company’s commitment to innovation, operational efficiency, and customer-centric solutions as key drivers of its market leadership. Looking ahead, nCino aims to capitalize on emerging opportunities by delivering scalable, value-driven solutions tailored to the evolving needs of financial institutions.

Technical Observation (on the daily chart):

The Relative Strength Index (RSI) over a 14-day period stands at a value of 30.19, currently nearing oversold zone, with expectations of a consolidation or support from the current important support levels of USD 30-USD 33. Additionally, the stock's current positioning is between both the 50-period SMA and 200-period SMA, which may serve as dynamic short to medium-term resistance and support levels respectively. 

As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘Watch’ rating has been given for nCino, Inc. (NASDAQ: NCNO) at the closing market price of USD33.41, as of January 02, 2025. 

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is January 02, 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.