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Shares of Pivotal Software Inc. are down 42% on Wednesday after the software company released disappointing results for the first quarter.
Wedbush analyst, Daniel Ives, called the train wreck district and dubbed Pivotal's
PVTL, -43.61%
Deferred revenue and billing figures are "disastrous" in the deterioration of share values on Wednesday morning.
See more: Pivotal Software lowers its stock after profits
"While management blamed the" complex technology landscape "that had a negative impact on the quarter, it's clear to us that this management team does not have control over the underlying issues that are impacting negative on its sales cycles and activity in the field, which worries us. this quarter will mark the beginning of "dark days" for Pivotal (and its investors), "wrote Ives, who reduced his rating to the neutral position from outperformance and lowered his target from $ 26 to $ 15.
Ives argued that the company's "profitability outlook" had been further removed, with Pivotal's management facing implementation challenges in North America as well as secular challenges. "Unfortunately, we have seen this movie play too many times in our decades covering the software space and we think it will not be a story of recovery overnight," he wrote.
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Needham analyst Jack Andrews said he expected Pivotal stocks to "languish for at least a quarter" after the latest results, but he said the stock would remain attractive if the losses after the trading hours were to continue. This would mean that Pivotal shares would trade at a price-to-value multiple of less than three, "which we believe is a decisive asset for a strategic asset with solid growth, growing margins. and a higher reactivity potential, "said Andrews.
He credits the stock for a purchase but narrows his price target from $ 28 to $ 21.
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Alex Kurtz, an analyst at KeyBanc Capital Markets, wrote that, while Pivotal's outlook was "disappointing," after-hours sales seemed to assume an "unfavorable scenario" for the company.
"Better understanding the magnitude of the slowdown in demand will be an important factor in this downward perspective, as the shortfall could be located in a handful of accounts given the size of the pivotal transaction." , did he declare.
Kurtz is overweight in equities and has reduced his target from $ 27 to $ 21.
Pivotal shares have lost 34% since the beginning of the year, while the S & P 500
SPX, + 0.37%
gained 12%.
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