Motorola Solutions (MSI) to Acquire Spillman Technologies

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In a bid to expand its software portfolio, Schaumburg, IL-based Motorola Solutions Inc. MSI recently announced its intention to acquire Spillman Technologies. The deal is expected to close by Dec 31, 2016. The financial terms of the transaction, however, were not revealed.

Salt Lake City, UT-based Spillman Technologies is a privately held firm, which was founded in 1982. The company offers comprehensive law enforcement and public safety software solutions for computer-aided dispatch (CAD) and records management systems (RMS). It also provides an integrated suite of comprehensive software solutions and next generation cloud-based tools for jail management systems, fire, mobile data and data sharing to name a few. The company also serves more than 1,700 agencies in the U.S. through its public safety software. Given this backdrop, Motorola Solutions’ decision to buy this company is undoubtedly a prudent move.

The acquisition, if completed successfully, will broaden Motorola Solutions’ command center capabilities by enabling public safety customers to easily connect to real-time data and insights. We expect investors to remain focused on updates of Motorola Solutions’ impending purchase.

We appreciate Motorola Solutions’ growth-by-acquisition strategy. Earlier in the month, the company acquired Wireless Technology Equipment Company to broaden its mission-critical communication services in Florida. The acquired company provided communications system support and two-way radios.

Additionally, Motorola Solutions completed the acquisition of Airwave Solutions earlier this year. This buyout boosted the company’s results in the second quarter of 2016. We expect the deal to boost third-quarter revenues by approximately $130 million.

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Zacks Rank & Key Picks

Motorola Solutions currently carries a Zacks Rank #2 (Buy). Investors interested in Wireless equipment division may also consider InterDigital, Inc. IDCC, Clearfield, Inc. CLFD and Novatel Wireless Inc. MIFI.

Shares of InterDigital, Inc. have appreciated 48% over the last three months. The company has an impressive earnings history, having outshined the Zacks Consensus Estimate in each of the last four quarters. The average beat is 82.43%. The company sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Clearfield have appreciated 11.9% over the last three months. The Zacks Rank #2 (Buy) company has an impressive earnings history. Its earnings outspaced the Zacks Consensus Estimate in three of the last four quarters. The average beat is 82.01%.

Shares of Novatel Wireless have appreciated over 100% over the last three months. The company holds a Zacks Rank # 2.


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