Tag Archives: crm

CyrusOne Hits All-Time High As Data Center Stocks Advance

CyrusOne ( CONE ) stock hit an all-time high on the heels of Tuesday’s investor day, where the data center operator outlined goals to double the company’s revenue by 2020. Cloud computing and corporate outsourcing of IT infrastructure has increased demand for data center space. Data center operators — including DuPont Fabros Technology ( DFT ), Digital Realty Trust ( DLR ) and CoreSite Realty ( COR ) — are among the top performers in IBD’s Finance-Property REIT group. It’s ranked No. 46 out of 197 industry groups that IBD tracks. Many data center operators are real estate investment trusts. Apple ( AAPL ), Microsoft ( MSFT ), Facebook ( FB ) and Salesforce.com ( CRM ) are among tech companies expanding data centers. Data center operators provide space, power and cooling. Customers pack the warehouse-sized data centers with their own computer servers and other gear. The data center market has been divided among wholesale providers — such as Digital Realty   and DuPont Fabros — and retail operators such as Equinix ( EQIX ), though some lines are blurring. CyrusOne stock was up a fraction in midday trading in the stock market today , above 42, but earlier rose nearly 5% to 43.42, its record high. Shares have gained nearly 13% in 2016. At its investor day event, CyrusOne said that it aims to double its enterprise value from around $4 billion to $8 billion by 2020, said Colby Synesael, an analyst at Cowen & Co., in a research report. “The company plans to achieve this goal by doubling its revenue, EBITDA and normalized FFO from 2016 to 2020 while being prudent to maintain (debt) leverage at 4.5 times or less, so that it can achieve an investment grade credit rating over that period,” added Synesael. REITs use a cash flow metric called funds from operations, or FFO. DuPont Fabros stock has shot up more than 25% this year, while CoreSite has gained about 20%. Digital Realty is up 15%. Equinix, part of IBD’s Internet-Infrastructure Solutions group, has gained 5%. Capital spending has been rising at data center operators. DuPont Fabros, aiming to raise $275 million, announced a stock offering on March 17. “New leasing volume suggests that demand remains robust and should support DFT’s growth plans with low leverage,” said Barclays analyst Ross Smotrich in a report. “However, the trade-off is that DFT had made it abundantly clear at their November 2015 investor day that their growth strategy would not include new equity. When future capital needs arise, therefore, investors may anticipate an equity raise.” Image provided by Shutterstock .

Adobe Summit Sees World Gone Digital, From ‘Deadpool’ To Sea Of Data

Hit anti-superhero flick “Deadpool” got made with what’s been called an all-Adobe workflow . No wonder  Adobe Systems ( ADBE ) CEO Shantanu Narayen sounds a fan. In a keynote address kicking off the Adobe Summit 2016 digital marketing conference Tuesday, he used the cheeky comic book movie to illustrate how the content world’s gone digital. Adobe, of course, makes the Creative Cloud digital tools, such as Photoshop and Premiere Pro video editing software, and the Adobe Marketing Cloud tools used to track online content popularity and to power advertising decisions. The company gets a near-top IBD Composite Rating of 97, and the stock hit a new high in high volume Friday, after Adobe beat analyst views in its first-quarter earnings report and lifted its annual sales and earnings guidance. After February’s market dip, Adobe stock is back where it was in early January. How ‘Deadpool’ Went Digital “Last year one of the biggest media companies in the world decided to make an unknown superhero as big as Captain America without the usual big media and TV spots,” Narayen said in a livecast keynote  from the event in Las Vegas that he said drew more than 10,000 attendees. “Deadpool, a brash antihero most people had never heard of, wove his way into their lives through using one of the most innovative digital and social media campaigns ever.” “Deadpool,” by film folks at Twenty-First Century Fox ( FOX ), “shattered all box office records and is on the way to becoming the highest-grossing R-rated movie in film history,” Narayen said. He went on to talk about how MasterCard ( MA ), too, had moved to “pivot” a bit from traditional ad strategy toward online and social forms, exemplified by its #Priceless Surprises campaign that included things like winning a trip to the Grammy Awards. “Businesses must re-imagine how they interact with customers in a digital-first and digital-enabled world,” Narayen said, adding that “getting content to the right person at the right place at the right time takes data” — that is, the ability to analyze and target. Adobe Summit 2016 Debuts Adobe made several announcements in conjunction with its annual Summit show, including these three Adobe Marketing Cloud enhancements , among others: Adobe Certified Metrics , which standardizes some digital page and video viewership data that’s tracked in the Marketing Cloud. That will allow measurement partners, such as ComScore ( SCOR ) and Nielsen ( NLSN ), to “provide a complete view of total digital audience engagement across TV and digital,” which could boost ad-revenue opportunities. A new developer portal , Adobe.io. A TV recommendation engine called Adobe Primetime Recommendations, based on how the majority of U.S. households watch streaming TV and movies. It could be used by media companies and other kinds of firms to power what Adobe calls ” the next generation of TV recommendations.” TV Ratings For Digital Ad-Buying After viewing migrating away from the television itself toward online viewing via devices such as mobile phone screens and tablets, some online video viewing is now “going back to the living room,” Jeremy Helfand, Adobe’s vice president of video solutions, told IBD. “Over 20% of ‘TV Everywhere’ viewing is happening on connected devices — Apple ( AAPL ) TV, Roku or ( Sony ( SNE )) PlayStation or ( Microsoft ( MSFT )) Xbox, which is quite remarkable.” Historically, he says, “there was one currency — it was Nielsen — that’s what was used in order to purchase advertising,” Helfand said, “largely through upfronts and some residuals — that’s how advertising was bought and sold.” But tracking how many people are watching what these days, across a bunch of devices and websites, hasn’t been easy and that has hampered online video monetization efforts. Adobe Certified Metrics, which involves a developing partnership with ComScore following last year’s link-up with Nielsen, is one way that Adobe aims to make audience measurement easier and more standardized. “You’ve seen ComScore merge with Rentrak trying to bring digital and linear together just as Nielsen is,” Helfand said. “And you’re also seeing some media companies build their own definitions of who their audiences are, and go out to (ad) buyers and say ‘here’s my audience’.” The partnerships and platform development further Narayen’s goal of Adobe products and services being able to “make, monetize and measure” the digital experiences that people have in today’s world of content. The hope is that in turn will make Adobe software more crucial across a breadth of industries. In its Q1 report last week, digital marketing segment revenue at Adobe reached $406.2 million, which Pacific Crest Securities analyst Brendan Barnicle said, in a research note, was “better than the expectation of $402.7 million.” He added that the Summit event this week was “likely  to  provide  additional  positive  announcements  on  the marketing business.” Adobe added 798,000 new subscribers for its Creative Cloud businesses last quarter, and Barnicle noted that 30% of them were new to Adobe. He sees more CEOs driving adoption of Adobe products. “Like Salesforce.com ( CRM ) and Workday ( WDAY ), Adobe is seeing more CEOs make purchasing decisions,” he wrote. “In the 2016 Pacific Crest CFO Survey, both CIOs and CMOs saw a decline in the portion of the IT budget that they control. We believe that CEOs are making more IT decisions than ever before. They are looking to move their businesses to digital and to the cloud, and Adobe is one of several beneficiaries.” The Adobe Summit runs through Thursday, with actor George Clooney among speakers listed for the event — albeit most come more from the tech side than from Tinseltown. San Jose, Calif.-based Adobe has offices around the globe, including in Diegem, Belgium. It’s just outside Brussels, where terrorist attacks hit the airport and a subway station early Tuesday. Narayen started his talk with condolences, and despite its Summit event @Adobe said it was keeping its Twitter account silent for the day, in light of the Brussels situation.

Red Hat Earnings: Amazon A Threat In Linux Landscape?

There’s a notion out there, says Deutsche Bank analyst Karl Keirstead, that Amazon ’s ( AMZN ) flavor of the Linux open-source operating system is about as good as other Linux distributions — and since it’s free and Amazon Web Services (AWS) offers good support, converting is cheap. So does that stand to hurt Red Hat ( RHT ), which reports its fiscal fourth-quarter 2016 earnings after the stock market close Tuesday? “Bottom line, we conclude that the number of migrations from RHEL (Red Hat Enterprise Linux) to Amazon Linux remains quite modest and mostly confined to small enterprise customers,” Keirstead wrote in a research note March 13. “Larger RHEL-centric customers have only a small mix of workloads on AWS, they value OS consistency across their hybrid infrastructures, they prefer support from RHT and/or view the cost savings of a switch as being too modest to be worth the hassle. “These advantages appear to more than offset a view that AMZN Linux is at/near functional parity with other Linux distributions.” Keirstead reiterated Deutsche’s buy rating for Red Hat with a 95 price target, which might take Red Hat a couple of months to achieve if it stays on the same upward trajectory that it’s maintained since bottoming out Feb. 8 at a two-year low of 59.59. Red Hat stock was unchanged at 74.90 on Monday after rising 3.2% last week, closing just below its 200-day moving average. Shares are just 12% off a 16-year high set Dec. 30, 24% above its Feb. 8 low. But it looks like Red Hat is rebounding firmly from the Software Sag of ’16 that battered many of Red Hat’s rivals and tech players in January through early February. Red Hat stock gets an IBD Composite Rating of 84 out of a possible 99, factoring in earnings, sales, stock performance, institutional ownership and other metrics. Enterprise software developer Salesforce.com ( CRM ) carries an 81, Microsoft ( MSFT ) ranks 76, software giant Oracle ( ORCL ) earns a 61 and SAP ( SAP ) a 70. For its Q4 ended Feb. 29, analysts polled by Thomson Reuters expect Red Hat earnings per share up 9% from a year earlier to 47 cents minus items, matching the company’s guidance. Analysts expect revenue up 16% to $537 million, which also would match the midpoint of the company’s guidance of between $535 million and $539 million, and rival the year-ago sales growth rate of 16%. At those levels, Q4 would be Red Hat’s first quarter decelerated to single-digit growth since EPS flattened at 42 cents in fiscal 2015’s Q3. It would be the 16th consecutive quarter of mid-to-high-teens sales growth. In a research note issued Thursday, Robert W. Baird analyst Steven Ashley warned that Red Hat’s long-term revenue growth in Q4 could have fallen below expectations as seen in historical, sequential long-term growth weakness every three years, going back to Q4 2007. This is due to what he theorizes as three pools of larger deals that renew every three years in Q4, with the most recent cohort in Q4 being smaller than the others. “We believe this nuance (if correct) is truly just ‘noise’ and short-term billings should remain strong,” Ashley said. He models Q4’s total billings growth (long-term and short-term) at a 10% year-to-year improvement vs. the 12% consensus. “Where could we be wrong?” Ashley asked. “Signing a bunch of ‘new’ large three-year deals could augment the smaller renewal pool.” He tipped his hat to Baird’s outperform rating on Red Hat with an 80 price target.