Needham & Company Maintains a 'Hold' on SolarWinds (SWI) Following Solid MarQ
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Price: $18.49 --0%
Rating Summary:
9 Buy, 21 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
9 Buy, 21 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Needham & Company maintains a 'Hold' on SolarWinds (NYSE: SWI).
Needham analyst says, "The Solarwinds (SWI) MarQ results were a solid “beat”. Overall activity across regions and products was solid, including federal which, though small, (12% of license) was above plan. Investors have been eagerly awaiting the answers to key questions on SWI, including: can SWI accelerate license growth, and can SWI maintain its 50% opmgn profile while expanding geographically and investing in S&M and R&D? Our view of license performance is that MarQ was solid, growing 3% q/q. The second question, of margin sustainability, remains open, as the MarQ 51% opmgn performance was well above 46-48% previous guidance, yet we learned that hiring was below expectations for MarQ. As such, opmgn will moderate through CY11 in the high 40s, and may exit 4Q at 50%, according to management. The margin sustainability question remains open, as a result. Similarly, there was much discussion about the new sales of Hyper9 (acquired) adding 100 new customers in the quarter, as well as the downloads of “de-coupled” stand-alone products; while the activity is impressive, it remains unclear when such activity may accelerate revenue growth."
For more ratings news on SolarWinds click here and for the rating history of SolarWinds click here.
Shares of SolarWinds closed at $23.66 yesterday.
Needham analyst says, "The Solarwinds (SWI) MarQ results were a solid “beat”. Overall activity across regions and products was solid, including federal which, though small, (12% of license) was above plan. Investors have been eagerly awaiting the answers to key questions on SWI, including: can SWI accelerate license growth, and can SWI maintain its 50% opmgn profile while expanding geographically and investing in S&M and R&D? Our view of license performance is that MarQ was solid, growing 3% q/q. The second question, of margin sustainability, remains open, as the MarQ 51% opmgn performance was well above 46-48% previous guidance, yet we learned that hiring was below expectations for MarQ. As such, opmgn will moderate through CY11 in the high 40s, and may exit 4Q at 50%, according to management. The margin sustainability question remains open, as a result. Similarly, there was much discussion about the new sales of Hyper9 (acquired) adding 100 new customers in the quarter, as well as the downloads of “de-coupled” stand-alone products; while the activity is impressive, it remains unclear when such activity may accelerate revenue growth."
For more ratings news on SolarWinds click here and for the rating history of SolarWinds click here.
Shares of SolarWinds closed at $23.66 yesterday.
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