Canaccord Genuity Reiterates a Buy Rating on Splunk Inc.

By George MacDonald

In a report released today, Richard Davis from Canaccord Genuity reiterated a Buy rating on Splunk Inc. (NASDAQ: SPLK), with a price target of $83. The company’s shares opened today at $68.64.

Davis wrote, “We are trimming our price target by $3.00, effectively taking a more conservative view on the target multiple and expecting SPLK shares to largely maintain their current 12.7x EV/revenue multiple on F2016/C2015 revenues. Our new $83.00 price target is based on a 12.6x EV/revenue multiple applied to our revised F2017/C2016 estimate of $807M plus approximately $1.15B in prospective net cash.”

Currently, the analyst consensus on Splunk Inc. is Strong Buy and the average price target is $81.88, representing a 19.3% upside. In a report released today, Morgan Stanley also reiterated a Buy rating on the stock.

The company has a one year high of $74.88 and a one year low of $39.35. Currently, Splunk Inc. has an average volume of 1.93M.

Financial bloggers on sites such as SeekingAlpha, investorplace.com and others, seem to have Positive view on SPLK. When evaluating the opinions of financial bloggers over the last 3 months, 63% of bloggers have indicated a Bullish sentiment, while 37% have indicated a Bearish sentiment. The average blogger Bullish sentiment in the sector is 67% which is slightly more positive than the blogger sentiment of SPLK.

Unlike Canaccord Genuity`s latest rating, based on the recent corporate insider activity of 115 insiders, corporate insider sentiment is neutral on the stock. Most recently, in March 2015, Steven Sommer, a SVP & Chief Marketing Officer at SPLK sold 3,270 shares for a total of $199,639.

According to TipRanks.com, Davis is a 4-star analyst with an average return of 6.6% and a 57.0% success rate. Davis covers the Technology sector, focusing on stocks such as Bottomline Technologies, Nuance Communications, and Ultimate Software.

Splunk Inc provides software products. Its flagship product is Splunk Enterprise and at its core is a proprietary machine data engine, comprised of collection, indexing, search, reporting analysis and data management capabilities.