Quantcast

Nutanix (NTNX) Looks Bright Post Q1 Earnings: Time to Buy?


Shutterstock photo

A successful investor understands the importance of retaining well-performing stocks in the portfolio at the right time. Indicators of a stock's bullish run include a rise in share price and strong fundamentals.

Nutanix Inc. NTNX   is one such technology stock that has been on healthy growth trajectory, of late. It has rallied 83.3% for the past six months, outperforming 12.7% growth recorded by the industry  it belongs to.

Let's delve deeper and take a look at some of the aspects aiding the company's performance.

Upbeat Q1 Results

Though Nutanix reported loss of 16 cents in the first-quarter fiscal 2018, it was narrower than the Zacks Consensus Estimate of a loss of 26 cents and year-ago quarter's loss of 20 cents.

Revenues surged 46.1% from the year-ago quarter to $188.6 million. Product revenues soared 42.7% year over year to $153.5 million, while support & other services revenues jumped 61.3% to $35 million.

Customer Base Expansion Continues

Nutanix added 760 customers taking the total end-customer count to 7,813 at the end of the reported quarter. Number of deals, worth more than $1 million, jumped 36% year over year to 49.Top three deals were all in the federal vertical and accounted for more than $15 million in billings. Among these three deals, two customers selected the company's AHV hypervisor.

Healthcare vertical performed favourably in the quarter, as the company reported seven deals greater than $1 million. Notable customers were Baylor Scott & White Health and an S&P 500 company that operates one of the largest clinical laboratory networks in the world.

Nutanix booked 15 deals worth more than $2 million.

Prism Pro adoption increased 40% sequentially. The company had 16 Prism Pro deals in excess of $100,000 in the quarter.

Positive Earnings Surprise History

Nutanix has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in the trailing four quarters, delivering a positive average earnings surprise of 18.5%.

Further, it has a long-term expected EPS growth rate of 20%.

Other Growth Drivers

The company launched Xi Cloud Services in strategic partnership with Alphabet GOOGL division, Google.

We believe that Nutanix's robust product portfolio aided by the launch of Nutanix Cloud and Xi cloud services will continue to boost clientele. Networking and security will further aid customer addition.

Moreover, collaboration with the likes of International Business Machines Corporation IBM is a positive.

Currently, Nutanix carries a Zacks Rank #2 (Buy).

Another top-ranked stock in the broader technology sector is NVIDIA Corporation NVDA , sporting a Zacks Rank #1 (Strong Buy).You can see the complete list of today's Zacks #1 Rank stocks here .

NVIDIA has a long-term expected growth rate of 11.2%.

Wall Street's Next Amazon

Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It's a once-in-a-generation opportunity to invest in pure genius.

Click for details >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

International Business Machines Corporation (IBM): Free Stock Analysis Report

Alphabet Inc. (GOOGL): Free Stock Analysis Report

Nutanix Inc. (NTNX): Free Stock Analysis Report

NVIDIA Corporation (NVDA): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , Business , Earnings , Stocks
Referenced Symbols: IBM , GOOGL , NTNX , NVDA


More from Zacks.com

Subscribe






Zacks.com
Contributor:

Zacks.com

Equity Research








Research Brokers before you trade

Want to trade FX?





Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com