What You Need To Know About Splunk Inc. (SPLK)

Splunk Inc. (NASDAQ:SPLK) finished Wednesday with an addition of $5.93 to close at $161.59, an upside of 3.81 percent. An average of 1,591,380 shares of common stock have been traded in the last five days. There was a gain of $15.13 in the past week. The last 20 days have seen an average of 1,541,670 shares traded, while the 50-day average volume stands at 1,752,246.

SPLK stock has increased by 7.38% in the last month. The company shares reached their 1-month lowest point of $136.83 on 09/29/21. With the stock rallying to its 52-week high on 02/02/21, shares of the company touched a low of $110.28 and a high of $222.19 in 52 weeks. In spite of this, the price is down -27.27% from the 52-week high.

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Insider Transactions

27 days have passed since Splunk Inc. (SPLK) last reported insider trading activity. Child Jason, who is SVP & Chief Financial Officer, most recently acquired $1,693 shares at $153.41 per share on Sep 17. In this transaction, the insider spent $259,723. Chief Accounting Officer, Emanuelson Timothy, disposed of 358 shares at a price of $151.02 on Sep 16. The insider now owns more than $54,065 worth of shares. Prior to that, President and CEO Merritt Douglas went on to Sale 27,526 shares at $151.55 each on Sep 16. An amount of $4,171,448 was transacted.

Valuation Metrics

Splunk Inc. (SPLK) has a trailing price-to-earnings (P/E) ratio of 29.20 for the broader industry and 37.24 for the sector. The stock’s beta is 1.23. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 10.77, the price-to-book (PB) ratio at 23.35.

The quick ratio of Splunk Inc. for the three months ended July 30 was 2.40, and the current ratio was 2.40, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 2.69 and a total debt to equity ratio of 2.69 for the quarter ending July 30. On the profitability front, the trailing 12-month gross margin is 73.40% against a 5-year average of 79.7%. Splunk Inc.’s EBITDA margin for the year ending July 30 is -29.20%, while its operating margin for the same period stands at -42.80%. Its gross profit as reported stood at $1.68 billion compared to revenue of $2.23 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Splunk Inc.’s return on assets was -21.00%, compared to -12.5% over the last five years. In the past year, the return on investment has been -20.20%, and the 5-year average is -19.9%. Meanwhile, the return on equity (ROE) for the past 12 months has been -85.70% and the 5-year average holds at -30.4%. For the broader industry, ROE averaged 3.34 over the past year.

Earnings Surprise

For the three-month period that ended July 30, Splunk Inc. had $267.04 million in cash. The analyst consensus anticipated Splunk Inc.’s latest quarter earnings to come in at -$0.69 per share, but it turned out to be -$0.62, a 10.10% surprise. For the quarter, EBITDA amounted to -$252.71 million. Shareholders own equity worth $161.55 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Splunk Inc. (SPLK) price momentum. RSI 9-day as of the close on 13 October was 72.73%, suggesting the stock is Overbought, with historical volatility in this time frame at 30.47%.

As of today, SPLK’s price is $153.89 +10.33% or $15.13 from its 5-day moving average. SPLK is currently trading +6.53% higher than its 20-day SMA and +36.88% higher than its 100-day SMA. However, the stock’s current price level is +14.93% above the SMA50 and -7.95% below the SMA200.

The stochastic %K and %D were 93.76% and 88.18%, respectively, and the average true range (ATR) was 4.96. With the 14-day stochastic at 99.20% and the average true range at 4.77, the RSI (14) stands at 65.92%. The stock has reached 6.83 on the 9-day MACD Oscillator while the 14-day reading was at 8.61.

Analyst Ratings

UBS upgraded Splunk Inc. (NASDAQ: SPLK) to a a Buy rating in its most recent analyst report. Previously, the stock was rated as a a Neutral.The consensus rating for Splunk Inc. (SPLK) among analysts is Overweight. According to current brokerage recommendations, 0 brokerage firms advise that investors sell SPLK, while 14 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 2 analysts, while 21 others rate it as a “buy”.

What is SPLK’s price target for the next 12 months?

Analysts predict a range of price targets between $133.00 and $225.00, with a median target of $184.00. Taking a look at these predictions, the average price target given by analysts for Splunk Inc. (SPLK) stock is $179.90.


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