UPDATE: Piper Jaffray Downgrades Nutanix (NTNX) to Neutral

(updated to add analyst comment)

Piper Jaffray analyst Andrew Nowinski downgraded Nutanix (NASDAQ: NTNX) from Overweight to Neutral with a price target of $28.00 (from $47.00).

The analyst comments "There were some positives in the quarter, including 110% growth in subscriptions, but the company continues to struggle with execution issues, which caused total revenue and billings to miss guidance. Looking ahead, management expects revenue to decline on a Y/Y basis, despite maintaining opex growth in the 40% range. It is clear that this model is unsustainable, requiring massive amounts of spending just to support modest revenue growth, which we believe is attributable to competition. As evidence, Dell reported another quarter of triple-digit growth for VxRail. While valuation at these levels looks attractive, we would wait for revenue growth and opex growth to stabilize before getting more constructive."

For an analyst ratings summary and ratings history on Nutanix click here. For more ratings news on Nutanix click here.

Shares of Nutanix closed at $26.25 yesterday.

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