Who's Impressed With Nutanix Following NEXT Conference?

Cloud computing software company Nutanix Inc NTNX has been in the news recently after Google parent Alphabet Inc GOOGL GOOG announced Wednesday a partnership with the former. On the news, Nutanix shares jumped over 9 percent on Wednesday.

Improving Story

Close on heels of this development, an analyst at BTIG said he came away from Nutanix' user conference impressed by the scope of its ambition to completely re-platform infrastructure management and provisioning.

While saying converged infrastructure that automates the mundane behind a single control plane is the essence of what cloud offers, analyst Edward Parker said doing it with on-premise infrastructure is a place where public cloud providers can't play. Parker feels mastery of hybrid cloud requires mastery of private cloud.

The analyst is of the view Nutanix has an improving story there, although it might have to contend with VMware, Inc. VMW, which is looking to trademark hybrid cloud if possible.

Software Growth In Focus

At the present, BTIG believes Nutanix continues to enjoy growth, driven by convenience and cost reduction factors that hybrid cloud infrastructure lends to certain environments. That said, the firm cautioned that investors should focus on increased software sales — an indicator of the company's ability to sustain a high growth, high margin business.

"Increasing penetration of tier 1 workloads would also be a validation, with efforts to buildup global account managers a potential catalyst here," the firm said.

"The extent to which the company successfully emerges as the de-facto "enterprise OS" remains a tall order and very much an open question, but we believe this company has a high ceiling."

The firm maintains its Neutral rating on the shares of Nutanix.

In pre-market trading, Nutanix shares were rallying 2.02 percent to $20.25 after ending Thursday's session down 2.11 percent at $19.85.

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