For his second "Executive Decision" segment of Monday's Mad Money program, Jim Cramer spoke with Sanjay Dhawan, CEO of Cerence Inc. (CRNC) , the automotive AI technology company that powers over 320 million vehicles.
Dhawan explained that Cerence was just one of many divisions inside of Nuance Communications, but as an independent company, they've been able to focus and grow substantially.
Nuance has since agreed to be acquired by Microsoft (MSFT) for $20 billion. Cerence was spun off from Nuance in 2019.
Cerence provides voice assistant technology, acting as a hands-free copilot for drivers. Dhawan said their most used applications are around navigation, phone interactions and music search capabilities. They aim to create a seamless experience both inside and outside of the car.
Let's check out a few seamless charts.
In this daily bar chart of CRNC, below, we can see that prices made a strong advance from July to February but then corrected lower into May with prices holding the rising 200-day moving average line. Prices rebounded into June and are trading back above the rising 50-day moving average line.
The On-Balance-Volume (OBV) line shows a weak pattern with a decline from December to May before a modest bounce. The Moving Average Convergence Divergence (MACD) oscillator is currently crossing to the downside for a take profit sell signal.
In this weekly Japanese candlestick chart of CRNC, below, we see a mixed to positive looking picture. Prices made a strong advance from a six month base in the $15-$20 area. The slope of the 40-week moving average line is positive and the line was tested in May.
The OBV line has been neutral or steady since February as prices corrected. The MACD oscillator is in the process of crossing to the upside from above the zero line - this will be a fresh outright buy signal.
In this daily Point and Figure chart of CRNC, below, we can see a downside price target in the $106 area.
In this weekly Point and Figure chart of CRNC, below, we can see a price projection in the $197 area.
Bottom line strategy: Traders could look to go long CRNC in the $106 area (the Point and Figure target) risking to $90. The $197 area is the price objective.
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