Splunk Spelunked After Disappointing Earnings; Analysts Drop Price Targets

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Splunk Spelunked After Disappointing Earnings; Analysts Drop Price Targets
Credit: © Reuters.

By Christiana Sciaudone

Investing.com --  Splunk (NASDAQ: SPLK ) sank 23% after missing estimates and getting a range of price target decreases. 

The software company reported a loss per share of 7 cents, well below the expected earnings per share of 9 cents with sales of $558 million missing the estimated $613 million.

Splunk provided guidance for fiscal 2021 fourth quarter revenue of between $650 million and $700 million, with negative operating margins. The expectation has been for revenue of $777 million, according to StreetInsider.

Annual recurring revenue (ARR) for the cloud rose 71% from a year earlier, while total ARR increased 44%. for a total $2.07 billion  

Mizuho Securities called the results  “very disappointing,” on the back of the lower than expected bookings and ARR. The firm downgraded the stock to neutral from buy, lowering the price target to $180 from $235, according to StreetInsider.

Mizuho noted the company withdrew 2023 guidance, which had helped support the surge in shares this year, when they hit an all-time high. 

Other firms, including Piper Sandler (NYSE: PIPR ) and BTIG also dropped price targets for Splunk.

 

 

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