- Morgan Stanley's Keith Weiss has upgraded Splunk (SPLK +4.5%) and Tableau (DATA +6.7%) to Overweight, and downgraded Tableau rival Qlik (QLIK -2.9%) to Equal-weight.
- Weiss: "As a 'Big Data pure play, Splunk benefits from strong secular tailwinds and significant market momentum." He highlights the machine data analytics software firm's FQ2 growth acceleration, and thinks its user conference (starts today) could act as a fresh catalyst. CFO Dave Conte will be hosting a talk with investors/analysts at the conference tomorrow at 2:15PM ET.
- Regarding Tableau, Weiss predicts the analytics/data visualization upstart's "with a large market opportunity, expanding distribution capacity and strong execution" will yield "plenty of runway" for growth. He thinks a bull case of 50%+ and 100%+ annual sales and free cash flow growth, respectively, is quite achievable.
- As for Qlik, Weiss admits the pending launch of Qlik Sense (previous) is an opportunity, but is concerned about execution, as well as the need for higher sales/marketing spend to support the Sense ramp. As it is, sales/marketing spend has outpaced revenue growth for several years.