Brian White: Tableau Crash Is 'Buying Opportunity'

• Tableau Software Inc DATA shares slid sharply in after-market trading on February 4, losing more than 30 percent.
• Drexel Hamilton’s Brian J. White maintained a Buy rating for the company, while reducing the price target from $132 to $75.
• While cautious, the guidance does not imply company specific issues and the pullback in shares offers a buying opportunity, White stated.

Tableau reported its 4Q15 revenue marginally ahead of expectations. “Although Tableau's revenue beat was much more modest relative to past quarters, the company delivered better than expected customer additions with positive big deal momentum in 4Q:15 and stable win rates,” analyst Brian White wrote.

Tableau also provided “an unusually cautious” guidance for 1Q16, reflecting a weakening macro environment, especially in the US market. Tableau's cautious outlook did not reflect any company specific issues, White commented.

The revenue and pro forma EPS estimates for 1Q16 have been reduced from $174.1 million to $157.1 million and from a loss per share of $0.06 to a loss per share of $0.17. The revenue estimate for 2016 has been reduced from $869.7 million to $799.9 million.

The analyst believes that there is no dearth of large IT vendors looking to add a high-quality company such as Tableau to their Big Data portfolio. “We continue to see attractive growth drivers on the horizon for Tableau, including the secular trend toward Big Data, increased market penetration, new opportunities with larger enterprises and international expansion,” the Drexel Hamilton report noted.

The sharp after-market sell-off presents “aggressive growth investors with a rare buying opportunity,” White added.