NasdaqGS:SPLK

Stock Analysis Report

Executive Summary

Splunk Inc. provides software solutions that enable organizations to gain real-time operational intelligence in the United States and internationally.

Rewards

Revenue is forecast to grow 17.48% per year

Risk Analysis

Currently unprofitable and not forecast to become profitable over the next 3 years

Highly volatile share price over past 3 months

Shareholders have been diluted in the past year



Snowflake Analysis

Mediocre balance sheet with limited growth.


Similar Companies

Share Price & News

How has Splunk's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SPLK's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

2.6%

SPLK

0.2%

US Software

0.9%

US Market


1 Year Return

26.7%

SPLK

42.1%

US Software

20.0%

US Market

Return vs Industry: SPLK underperformed the US Software industry which returned 42.3% over the past year.

Return vs Market: SPLK exceeded the US Market which returned 20.1% over the past year.


Shareholder returns

SPLKIndustryMarket
7 Day2.6%0.2%0.9%
30 Day9.2%7.7%1.4%
90 Day36.0%17.8%8.8%
1 Year26.7%26.7%43.7%42.1%22.5%20.0%
3 Year165.6%165.6%152.0%141.7%49.9%40.3%
5 Year159.7%159.7%224.3%201.1%73.2%54.1%

Price Volatility Vs. Market

How volatile is Splunk's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Splunk undervalued compared to its fair value and its price relative to the market?

14.73x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: SPLK ($172.52) is trading above our estimate of fair value ($155.99)

Significantly Below Fair Value: SPLK is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: SPLK is unprofitable, so we can't compare its PE Ratio to the Software industry average.

PE vs Market: SPLK is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate SPLK's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: SPLK is overvalued based on its PB Ratio (14.7x) compared to the US Software industry average (6x).


Next Steps

Future Growth

How is Splunk forecast to perform in the next 1 to 3 years based on estimates from 38 analysts?

27.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SPLK is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: SPLK is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: SPLK is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: SPLK's revenue (17.5% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: SPLK's revenue (17.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SPLK's Return on Equity is forecast to be high in 3 years time (22.4%)


Next Steps

Past Performance

How has Splunk performed over the past 5 years?

-2.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SPLK is currently unprofitable.

Growing Profit Margin: SPLK is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: SPLK is unprofitable, and losses have increased over the past 5 years at a rate of -2.9% per year.

Accelerating Growth: Unable to compare SPLK's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: SPLK is unprofitable, making it difficult to compare its past year earnings growth to the Software industry (17.1%).


Return on Equity

High ROE: SPLK has a negative Return on Equity (-17.08%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Splunk's financial position?


Financial Position Analysis

Short Term Liabilities: SPLK's short term assets ($2.6B) exceed its short term liabilities ($1.1B).

Long Term Liabilities: SPLK's short term assets ($2.6B) exceed its long term liabilities ($2.1B).


Debt to Equity History and Analysis

Debt Level: SPLK's debt to equity ratio (92.8%) is considered high.

Reducing Debt: Insufficient data to determine if SPLK's debt to equity ratio has reduced over the past 5 years.


Balance Sheet

Inventory Level: SPLK has a low level of unsold assets or inventory.

Debt Coverage by Assets: SPLK's debt is covered by short term assets (assets are 1.6x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: SPLK has sufficient cash runway for more than 3 years based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if SPLK has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.


Next Steps

Dividend

What is Splunk's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage1.2%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate SPLK's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate SPLK's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if SPLK's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if SPLK's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of SPLK's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.1yrs

Average management tenure


CEO

Doug Merritt (55yo)

4.3yrs

Tenure

US$13,505,795

Compensation

Mr. Douglas Merritt, also known as Doug, has been the Chief Executive Officer, President and Director at Splunk Inc. since November 19, 2015. Mr. Merritt served as Senior Vice President of Field Operations ...


CEO Compensation Analysis

Compensation vs Market: Doug 's total compensation ($USD13.51M) is about average for companies of similar size in the US market ($USD10.78M).

Compensation vs Earnings: Doug 's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Douglas Merritt
CEO, President & Director4.3yrsUS$13.51m0.026% $6.9m
Timothy Tully
Senior VP & CTO3.1yrsUS$6.25m0.061% $16.4m
Leonard Stein
Senior Vice President of Global Affairs1.4yrsUS$5.02m0.013% $3.5m
Susan St. Ledger
President of Worldwide Field Operations3.1yrsUS$9.09m0.12% $31.5m
Jason Child
Senior VP & CFO0.8yrsno datano data
Ammar Maraqa
Senior VP of Business Operations & Strategy and GM of IoT Markets3.1yrsno datano data
Timothy Emanuelson
Chief Accounting Officer0.4yrsno data0.018% $4.8m
Declan Morris
Chief Information Officer0yrsno datano data
Ken Tinsley
Head of Investor Relations0yrsno datano data
Scott Morgan
Senior VP3.1yrsno data0.032% $8.6m

3.1yrs

Average Tenure

52yo

Average Age

Experienced Management: SPLK's management team is considered experienced (3.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Douglas Merritt
CEO, President & Director4.3yrsUS$13.51m0.026% $6.9m
Stephen Newberry
Independent Director7.1yrsUS$319.94k0.024% $6.3m
Graham Smith
Independent Chairman0.9yrsUS$319.94k0.028% $7.5m
John Connors
Independent Director12.5yrsUS$349.94k0.044% $11.7m
Patricia Morrison
Independent Director6.8yrsUS$309.94k0.017% $4.5m
Frederick Felman
Member of Advisory Board0yrsno datano data
Ray Suorsa
Member of Advisory Board0yrsno datano data
Ethan Galstad
Member of Advisory Board0yrsno datano data
Diane Hagglund
Member of Advisory Board0yrsno datano data
Brent Chapman
Member of Advisory Board0yrsno datano data

6.8yrs

Average Tenure

60yo

Average Age

Experienced Board: SPLK's board of directors are considered experienced (6.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: SPLK insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 3.9%.


Top Shareholders

Company Information

Splunk Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Splunk Inc.
  • Ticker: SPLK
  • Exchange: NasdaqGS
  • Founded: 2003
  • Industry: Application Software
  • Sector: Software
  • Market Cap: US$26.908b
  • Shares outstanding: 155.97m
  • Website: https://www.splunk.com

Number of Employees


Location

  • Splunk Inc.
  • 270 Brannan Street
  • San Francisco
  • California
  • 94107
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SPLKNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDApr 2012
SPLKSWX (SIX Swiss Exchange)YesCommon StockCHCHFApr 2012
0R09LSE (London Stock Exchange)YesCommon StockGBUSDApr 2012
SPLK *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNApr 2012

Biography

Splunk Inc. provides software solutions that enable organizations to gain real-time operational intelligence in the United States and internationally. Its products enable users to investigate, monitor, analyze, and act on data regardless of format or source. The company offers Splunk Enterprise, a machine data platform with collection, indexing, search, reporting, analysis, alerting, monitoring, and data management capabilities; Splunk Cloud; and Splunk Light, which offers log search and analysis for small IT environments. It also provides Splunk Enterprise Security that addresses security threats and information, and event management; Splunk IT Service Intelligence, which monitors health and key performance indicators of critical IT and business services; Splunk User Behavior Analytics that detects cyber-attacks and insider threats; Splunk Phantom that automates and orchestrates incident response workflows; Splunk Machine Learning Toolkit; Splunk App for AWS that collects and analyzes data from amazon web services data sources; Splunk DB Connect to get business and enterprise context; and Cisco Firepower App for Splunk. Further, the company operates Splunkbase and Splunk Answers Websites, which provide an environment to share apps, collaborate on the use of its software, and provide community-based support and education, as well as offers application programming interfaces and software development kits. Additionally, it offers maintenance and customer support, training, and consulting and implementation services. The company serves cloud and online services, education, financial services, government, healthcare/pharmaceuticals, industrials/manufacturing, media/entertainment, retail/e-commerce, technology, and telecommunications industries. Splunk Inc. was incorporated in 2003 and is headquartered in San Francisco, California. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/18 00:39
End of Day Share Price2020/02/14 00:00
Earnings2019/10/31
Annual Earnings2019/01/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.