NET - A10 Networks: Shift In Product Mix Well Underway And Yielding Results

• A10 Networks has been gradually reorienting its products and sales team from the traditional load balancing business to also include security value-adds.
• As a result, its product mix is shifting to be more aligned with the requirements of the cybersecurity market.
• Its ADCs (Application Delivery Controllers) are gaining traction in data centers to control application delivery resulting in record revenues despite the competition.
• There are supply chain risks that could impact the top line, but this is cushioned to some extent by deferred payments and ADC adoption being characterized by a long customer cycle.
• The company is a buy with a target share price of $18.5-19 by the end of January 2022.

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