Shares of Tableau Software Inc DATA were up more than 14 percent on Friday, after the company reported estimate-beating earnings and revenue on Thursday afternoon.
Analysts at Pacific Crest reiterated an Overweight rating on the stock late Thursday, boosting their price target from $110 to $122 (when the stock traded around $97.43).
The bullish stance on Tableau is based primarily on “Strong underlying fundamentals, with upside driven by ~75% revenue growth,” the note assures. Not only is the company “scratching the surface of a large TAM with less than 3% penetration, but a major new product release (Tableau 9) in April could fuel additional upside this year.”
The firm provides its top 10 reasons to overweight Tableau:
1. Revenue: For the first quarter, the company delivered $15 million of upside to $130 million; approximately 75 percent growth
2. Cash Flows: Cash flow from operations reached $35 million (or 27 percent of sales) in the quarter.
3. New Customer Adds: The first quarter registered a 44 percent increase inn new adds, to 2,600+, reaching a total of 29,000.
4. “Large TAM: $22 Billion TAM if just ~3% of the 363 million Excel users adopt”
5. “Low Penetration Rate: Less than 0.1% penetration of Excel user base”
6. “Low ASP Product: List price of $1,999/seat or annual subscription of $500”
7. Large Deal Momentum: large deals (more than $100,000) more than doubled, to 249.
8. Patented Technology: Tableau invented a visual programming language called VizQL
9. “Major New Product Cycle: Tableau 9 was released in early April”
10. The Long-Term View: the analysts see plenty of upside to the $122 target, and see the stock possibly reaching $300 five years.
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