Nutanix’s Strong Financial Performance and Optimistic Outlook Drive Buy Recommendation

William Blair analyst Jason Ader has maintained their bullish stance on NTNX stock, giving a Buy rating today.

Jason Ader has given his Buy rating due to a combination of factors that highlight Nutanix’s strong financial performance and promising outlook. The company has demonstrated solid execution against its financial targets, which is evident in its impressive third-quarter results. Nutanix reported a 22% revenue growth, surpassing consensus expectations, driven by robust renewals and an increase in new customer acquisitions. Additionally, the company showcased strong profitability with a non-GAAP operating margin and EPS both exceeding market predictions, alongside a significant outperformance in free cash flow.
Furthermore, Nutanix’s guidance for the upcoming quarter and full fiscal year is optimistic, with revenue and operating margin projections slightly above consensus. The management’s confidence is reflected in the raised full-year free cash flow guidance, suggesting a stable macroeconomic environment and strategic investments in sales and R&D. These factors collectively position Nutanix well for continued market share gains, particularly against competitors like VMware, thus supporting the Buy recommendation.

In another report released today, Bank of America Securities also reiterated a Buy rating on the stock with a $95.00 price target.

Based on the recent corporate insider activity of 44 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of NTNX in relation to earlier this year.