Analysts Stay The Course On Barracuda Networks After Shares Get Pummeled

While Barracuda Networks Inc CUDA second-quarter earnings came in line with analyst expectations, shares were pummeled following the release, falling over 12 percent.

Analysts All Along Wall Street Remain Bullish

BWS Financial: Buy, $30 PT

Analyst Hamed Khorsand of BWS Financial is staying the course on Barracuda Networks, saying the negative reaction to the earnings release “creates an opportunity in owning a predictable free cash flow positive business in a high demand industry."

BWS Financial maintains a Buy rating on Barracuda Networks with a $30 price target.

BTIG: Buy, $30 PT

BTIG analyst Joel Fishbein took a similar stance on the company, praising an all-around solid second quarter that was overshadowed by slightly lower than expected profitability and margins due to continued investments, including email security and public cloud services.

“Barracuda’s mostly subscription business is profitable in an under-served market, with strong secular tailwinds from both an elevated threat environment and growing adoption of the public cloud,” said Fishbein.

BTIG maintains a Buy rating on the company with a $30 price target.

Stifel: Buy, $32 PT

Stifel analysts are also staying the course on the cloud security company, maintaining a Buy rating with a $32 price target.

“We see Barracuda as a story that appropriately balances growth and profitability with improving visibility, driven by 80%+ contribution from subscription revenue,” said Stifel analyst Gur Talpez.

Baird: Outperform, $29 PT

Given the drastic share price drop Barracuda experienced post-earnings, Baird analyst Jayson Noland views the stock as attractive at current levels given its public cloud traction and valuation relative to peers.

Baird maintains an Outperform rating on Barracuda Networks with a $29 price target.

“We remain positive on continued momentum in Core products and the gradual decline of Legacy, which in tandem should support a reacceleration of growth overall. While we expect investors to focus on renewal rate trends, we would note that low 90s is still impressive for SMB,” said Noland.

Barracuda closed Wednesday's regular trading down 12 percent at $22.65.

Related Link: Barracuda's Momentum Continues In Q2