NTNX - Nutanix: A Buyable Dip Especially When Weaker Outlook May Just Be About Deal Timing
2024-06-01 09:00:00 ET
Summary
- Shares of Nutanix have dropped more than 25% after reporting fiscal Q3 earnings and issuing a softer Q4 outlook.
- Management explained that its pipeline is filling up with larger deals, which are subject to lengthier sales cycles with unpredictable close timings.
- Historically, Nutanix has beaten its outlooks. A strong pipeline of large deals is a good catalyst to have in its upcoming FY25 (which begins in August for Nutanix).
- Still, the stock does have an overhang from a weighty valuation at ~5.3x FY25 revenue, which will be an obstacle to tremendous upside.
Small and mid-cap growth stocks have seen tremendous strength this year, setting them up for very high expectations and big disappointments this earnings quarter. That's what happened to Nutanix ( NTNX ), the infrastructure software vendor that specializes in hybrid and private cloud deployments....
Nutanix: A Buyable Dip, Especially When Weaker Outlook May Just Be About Deal Timing