Expect 'Improving Momentum,' In-Line Quarter From NetSuite

In a report issued Tuesday, Bren Capital analysts Sarah Hindlian and Frederick Havemeyer assured they anticipate NetSuite will report slight upside to estimates, driven by:

• 1. A robust deal pipeline going out of the second quarter.
• 2. Continued strength in manufacturing and ecommerce verticals.
• 3. “A push to more disciplined field sales from new hires running Enterprise and North America.”
• 4. An increasing internal focus on ameliorating the ramp time of new sales hires.

Moreover, the experts noted that the company continues to make a transition to larger customers, although it “remains comfortably in the mid-market where deal size is less lumpy and functionality requirements are less robust.”

Related Link: Brean Bullish On ServiceNow Heading Into Q3 Results

Brean continues to see 2015 as an investment year for NetSuite: The company is improving its sales force, constructing two new data centers in Europe and putting money down in enhanced functionality of its products through both acquisitions and R&D.

The Rating

Consequently, Hindlian and Havemeyer maintain a Hold rating and $107.00 fair value estimate on the stock. In the upcoming earnings call, the experts will be looking at “updates on new partnerships, as well as the potential for an early FY’16 outlook, though given FX fluctuations, the company may choose to wait until Q4’15 this year to provide its 2016 outlook.”

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.

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