Nutanix (NTNX) PT Lowered to $20 at Needham on Supply Chain and Sales Retention Pressures

Needham & Company analyst Jack Andrews lowered the price target on Nutanix (NASDAQ: NTNX) to $20.00 (from $34.00) after management meaningfully reset guidance based on (1) customer behavior in reaction to supply chain headwinds and (2) higher than expected sales rep attrition.

The analyst reiterated a Buy rating, stating "Management noted that the final month of 3QF22 - and the final few weeks especially - saw a large and unexpected impact to orders based on customer supply chains, which has further deteriorated in 4QF22. Additionally, management noted it expects supply chain issues "to persist for multiple quarters." At the same time, sales rep attrition increased qtr-qtr, which resulted in Nutanix entering 4QF22 below its headcount targets. The company is working to rectify these issues, although its ability to reduce supply chain shortages is admittedly limited."

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