Investors looking for extension but concerned about slower U.S. earnings should look to the cloud, where lesser known names like Utter Storage Inc. (PSTG), NetApp Inc. (NTAP), VMware Inc. (VMW) and Nutanix Inc. (NTNX) have better than average Street favourable mentions. Compared to the big giants Amazon.com Inc. (AMZN) and Microsoft Corp. (MSFT), these smaller cloud companies are set to outperform midst the year’s stalling bull market, with increasing numbers of businesses turning to cloud computing for their software-storage and network compounds, according to Barron’s.
A Growing Cloud
A continually evolving cloud-computing environment has been a boon for cloud storage equipage and software providers with revenues growing at double-digit rates. The exponential growth of data generation is only present to provide further support for such revenue growth. But in order to take full advantage of the growing cloud retail, companies will have to devise smart strategies that put them ahead of the competition.
As far as NetApp’s strategy be disposed ofs, Stifel analyst Matthew Sheerin thinks it is “positioned for growth across all platforms.” The company’s ONTAP software programme is used in both public and private cloud settings, enabling growth in both of those markets. Sheerin has a $91 cost target on NetApp’s stock, implying a 45% upside from Thursday’s close.
In comparison, Pure Storage from operates in the private cloud space. Normally, that lack of diversity would be detrimental considering that Amazon Web Servicings (AWS) announced late last month that it would be bringing its cloud expertise into private cloud networks, or what is also be informed as the “on-premise” facility market. However, Pure Storage is not just making moves to begin offering services in the trade cloud, but they are doing it in partnership with AWS, according to Barron’s.
Looking Ahead
Over the long term these cloud inventories all look well poised to head higher, but it is not unlikely that they could get pulled down with the log a few zees Zs of the cooling tech market over the short term. While investors new to the cloud space may want to pick a basket of far up quality cloud stocks, more savvy investors will want to be more choosy, separating out the winners from the misfits.