Tableau's 'Low-Hanging Fruit Already Picked,' Says Summit Readstone
Tableau Software Inc’s (NYSE: DATA) growth is likely to remain sluggish, with intensifying competition and the company facing increasing challenges in upselling within the install base, Summit Readstone’s Srini Nandury said in a report. He relaunched coverage of the company with a Hold rating and a price target of $53.
Low-Hanging Fruit Already Picked
With the competitive landscape expected to worsen, Tableau is unlikely to be able to generate robust revenue growth.
“Based upon on our conversations with industry insiders, Tableau is seen as a limited application rather than a broad platform which many enterprise users come to expect,” analyst Srini Nandury wrote. He added that although the company is working to enhance its product, it would take time to roll out the features users expect.
“In the near-term, Tableau growth will continue to be sluggish as many of the low-hanging fruit have already been picked and the upsells within the install base will be harder to come by,” Nandury commented.
Pricing Change Needed
Tableau’s products are perceived as expensive and the company needs to make its pricing more competitive in the near term. The analyst explained the dilemma being faced by Tableau as - “reduce the pricing with no increase in revenue above the prior levels or maintain the price and fight for every single customer the hard way.”
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Latest Ratings for DATA
|Jan 2017||Wells Fargo||Initiates Coverage On||Market Perform|
|Nov 2016||Summit Redstone Partners||Downgrades||Hold||Sell|
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