Aaron Rakers, an analyst from Wells Fargo, maintained the Hold rating on Nutanix (NTNX – Research Report). The associated price target is $60.00.
Aaron Rakers has given his Hold rating due to a combination of factors including Nutanix’s solid performance in recent quarters and the expectation of gradual benefits from the VMware competitive opportunity. Despite Nutanix’s strong execution momentum and leverage from renewal strength, there is a notion that while the Broadcom and VMware merger presents a significant opportunity for market share gain for Nutanix, these contributions are expected to accumulate over time. This is due to factors such as multi-year service level agreements, refresh cycles for servers and storage, and the nature of expanding customer relationships.
Moreover, the analyst notes the potential upside from the Cisco partnership, although it is anticipated to contribute more significantly in Fiscal Year 2025 rather than 2024. While acknowledging Nutanix’s positive trajectory in subscription revenue and above-expected guidance for revenue and ACV billings, the report suggests a cautious approach. The improvement in free cash flow projections and the increased price target reflect a positive outlook, yet the uncertainty regarding the competitive response from VMware and the timing of realization of partnership benefits warrant a conservative Hold rating at this stage.
In another report released on February 23, Morgan Stanley also maintained a Hold rating on the stock with a $58.00 price target.
NTNX’s price has also changed dramatically for the past six months – from $30.650 to $59.040, which is a 92.63% increase.
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Nutanix (NTNX) Company Description:
Nutanix, Inc. engages in the provision of enterprise virtualization and storage solutions. It specializes in cloud operating system that converges traditional silos of server, virtualization, storage, and networking into one integrated solution and unifies private and public cloud into a single software fabric. Its products are offered through the Acropolis and Prism brands. The company was founded by Dheeraj Pandey, Ajeet Singh, and Mohit Aron in 2009 and is headquartered in San Jose, CA.
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