On April 25, 2012, Wall Street was introduced by two really hot IPO`s; Splunk and Infoblox. Investors expected to see Splunk to open at $13 a share, but it surprised and opened at $17. Later on the same trading day, Splunk closed at about $32, after it peaked intraday at $38.
Splunk was one of the first big data companies to go public.
Splunk offer technology that helps large enterprises with their IT systems. I have tried Splunks system which is a big data software product. You can make your own dashboard with the data you want. Its up to you.
They can take streams of data from lots of different sources and their software will instantly index it to make it searchable. I like this software because you can take lots of different data sources and simply put it into one system where it can be searched. And best of all; you can make it the way you like it.
Splunk will make it easy to dump all your different data into your own system. Your own dashboard.
You can build your own reports, your own alerts and your own dashboards. You can gather and analyze system alerts to discover what is causing problems with an IT system, or to see the power consumed by various applications and servers.
Now, Splunk is trading at $54,36 with a market cap of $7,29 Billion. A small company compared to Microsoft, but very interesting.
As the analytics market continues to gain strength, especially in the enterprise space, Splunk has no doubt benefitted, becoming especially popular within financial services as the company offers advanced security analytics data.
Splunk has been expanding these cybersecurity offerings, acquiring two companies in the industry, Caspida and Metaphor Sofware, last year.
Despite the upward trajectory, Splunk has some stiff competition. The company`s rival, ELK Stack, an open source stack company, has been gaining massive global traction and is starting to become a threat.
Even bigger players such as Amazon, IBM and Microsoft are fighting for more market share. Investments into R&D in order to compete with these players may suppress profitability in the near-term.
Splunk will continue to invest heavily in marketing and sales, which is up about 50% YoY last quarter, to $162 million. R&D was up about 40% last quarter to about $66 million, which is both very important to stay competitive in the market.
CEO Dough Merritt raised Splunk`s fiscal 2017 revenue guidance by $30 million, to $880 million and that represent a growth of about 32%. He also told investors to anticipate fiscal full-year adjusted operating profit of 5%.
The Estimize consensus is calling for flat YoY earnings, as compared to -$0,02 from Wall Street. Revenue expectations of $179,0 million are nearly $5 million above the sell-side. Estimates on both the top and bottom-line seen massive revisions since the Q4 2015 report., with EPS expectations increased 92% and revenue 8%. This pegs YoY EPS growth at 102% and sales growth at 41%.
Splunk is set to release fiscal first-quarter results after the market close on Thursday, May 26, 2016, after the close.
Splunk historically has beaten both EPS and revenue estimates more than 73% of the time.
I will not be surprised if Splunk outperforms once again.
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Ket Garden
Shiny bull 