Market Overview

Oppenheimer Names Nutanix A 2018 Top Pick, Lays Out Bull Case

Share:
Oppenheimer Names Nutanix A 2018 Top Pick, Lays Out Bull Case

With the market extending its bull run, here's a recommendation from Oppenheimer for riding the rally. 

The Analyst

Analyst Ittai Kidron named Nutanix Inc (NASDAQ: NTNX) as one of his top 2018 picks on the view that the market still underappreciates the company's shift to a software model.

Oppenheimer reiterated an Outperform on Nutanix with a 12-18 month price target of $43.

The Thesis

Nutanix' Dell/EMC relationship remains stable and the relationships with International Business Machines Corp. (NYSE: IBM) and Lenovo Group Limited (ADR) (OTC: LNVGY) are expanding, Kidron said, citing his firm's channel checks. (See the analyst's track record here.) 

The company's exit from hardware removed channel friction while deploying Cisco Systems, Inc. (NASDAQ: CSCO) or Hewlett Packard Enterprise Co (NYSE: HPE), the analyst said. This could expand Nutanix' reach once sales are fully engaged, he said. 

Nutanix is the leading hyperconverged infrastructure vendor, with only VMware, Inc. (NYSE: VMW) as a strongly positioned alternative. The move to a software-only model means Nutanix can highlight platform breadth; drive faster adoption of its products; and catalyze an eventual shift to more services and subscription offering, Kidron said. 

"We believe this product breadth could make for a faster than expected software transition, bringing with it a quick reset to the hardware top-line adjustment and faster than expected gross margin increase," the firm said.

The Price Action

Shares of Nutanix are up more than 35 percent over the past year.

At the time of writing, the shares were down 2.04 percent at $37.62. 

Related Links:

Nutanix Shares Getting Attention Following RBC Price Target Raise

Nutanix Gaining Traction Among Forbes Global 2000 Companies

Latest Ratings for NTNX

DateFirmActionFromTo
Sep 2019UpgradesNegativePositive
Aug 2019MaintainsOutperform
Aug 2019MaintainsEqual-Weight

View More Analyst Ratings for NTNX
View the Latest Analyst Ratings

Posted-In: Ittai Kidron Oppenheimer softwareAnalyst Color Price Target Reiteration Analyst Ratings Best of Benzinga

 

Related Articles (CSCO + HPE)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
ELMDDougherty & Co.Initiates Coverage On12.0
MRNSCantor FitzgeraldAssumes7.0
MNRLCapital One FinancialInitiates Coverage On23.0
SONVertical GroupUpgrades
UNPMorgan StanleyMaintains136.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Trading Daily
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com

Report: Overstock-Coinbase Glitch Let Users Buy Items At A Discount By Paying In Bitcoin Cash Instead Of Bitcoin

KC Capital Management Uses Algorithms To Time Market Entries And Exits