Splunk (SPLK) PT Raised to $84 at Summit Research

Summit Research analyst Srini Nandury reiterated a Buy rating and boosted his price target on Splunk (NASDAQ: SPLK) to $84.00 (from $65.00) following strong results.

Nandury commented, "As expected, Splunk beat consensus revenue by 9.5% ($10.0 million) and raised estimates again - the largest beat since its IPO. Splunk has now beaten the mid-point of guidance by an average of 9.2% during each of the last ten quarters or $6.7 million. Splunk's momentum continues unabated, driven by new applications and new use cases, and the company continues to invest in R&D to fuel new use cases and invest in sales to pursue the large available and emerging opportunities.. We are increasingly confident Splunk is rapidly becoming a platform for unstructured data, akin to Oracle/MS-SQL server platforms, and the rise of Splunk reminds us of the rise of Oracle as a broad platform. Splunk's ecosystem is sticky and hard to displace given the plethora of applications being built by its customers. While there are several competitors such as Sumo Logic, Loggly, etc... we believe none of the little competitors have the use cases and platform functionality Splunk boasts of. As such, we reiterate our BUY rating and establish our new $84 PT (16x EV/F2016 sales)."

The firm raised F4Q revenue estimate to $137 million (prior of $135.6 million), but lowered EPS to $0.05 in-line with consensus on slightly higher Opex as Splunk continues to invest in R&D and sales. For F2016, they raise revenue to $585million (up from our prior of $573 million) versus consensus of $570 million and lower EPS to $0.10 (prior of $0.17), driven by higher revenue but slightly higher Opex.

For an analyst ratings summary and ratings history on Splunk click here. For more ratings news on Splunk click here.

Shares of Splunk closed at $64.94 yesterday.

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