Data Streaming Genie Is Out Of The Bottle, Confluent Positioned To Capitalize: Analyst

  • Needham & Company analyst Mike Cikos initiated coverage on Confluent Inc CFLT with a Buy rating and a price target of $35.
  • The analyst is bullish on the solid prospect of open-source Kafka, which has over 5 million unique downloads and is used by over 80% of the Fortune 100 companies, enabling consumer migration to Confluent's solutions.
  • The analyst sees Confluent's development of a fully-managed Flink offering, potentially echoing Kafka adoption, as a growth driver.
  • Confluent expects to introduce a fully managed Flink offering in late 2023, with recognized revenues growing in 2024. The analyst projects a potential tie-up of Kafka and Flink to drive strong demand. 
  • Going forward, the analyst expects increased usage of data streaming for real-time data processing by organizations to strengthen CLFT's position in the category.
  • Cikos expects revenues of $763.7 million in 2023 and $968.7 million in 2024 and projects EPS of $(0.17) in 2023 and $0.15 in 2024.
  • Also ReadConfluent's Profitability Pivot And Growth Potential Drive Analyst Upgrade, Stock Rises
  • Price Action: CFLT shares are trading higher by 7.70% at $30.92 on the last check Tuesday.
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