Splunk (SPLK) IPO Sees First-Week Surge of 113%

							Robert DeFrancesco’s
TechStockProspector.com
April 21, 2012


Splunk (SPLK) IPO Sees First-Week Surge of 113%
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We found out this past week that the enterprise-focused tech IPO is alive and well.
The three big offerings that I previewed at the start of the week all opened up from
their IPO prices:

*Splunk (SPLK, $36.20)—IPO price $17, opened at $32 +88%
*Infoblox (BLOX, $21.30)—IPO price $16, opened at $22.50 +41%
*Proofpoint (PFPT, $14.08)—IPO price $13, opened at $16.85 +30%

Of the three, Splunk, a Big Data play, had the largest first-day surge, managed to hold
its opening price and finished the week 113% above its IPO price. Splunk’s current
market cap of $3.4 billion gives it an incredible trailing price-to-sales (P/S) ratio of
28X. Even if revenue were to double this year, to $242 million, the forward P/S
would be 14X.

Why the interest? Splunk is a specialist in analyzing machine data, which is all of the
back-end data being churned out by websites, machines, power meters, appliances,
cars and equipment. This data, both structured and unstructured, provides
important insights into what’s going on behind the scenes. Customers use Splunk’s
solutions to improve efficiencies and drive revenue growth.

Splunk is well positioned and has the potential to grow into a much larger company.
But I am concerned about the valuation and the lock-up expiration in six months.
Also, there is the possibility of a follow-on stock offering because demand for the
IPO was so high (30X over-subscribed).

The April 2012 issue of Tech-Stock Prospector is now available at
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Here are some of the topics covered in the April 2012 issue:

*Playing the tech IPO cycle
*5 promising new small caps
*Demandware powers e-commerce
*Yelp delivers the reviews
*Bazaarvoice analyzes the feedback
*ExactTarget hits the social media mark
*A former high-flyer comes back to earth
*Mobile-ad play Millennial Media
*ValueClick’s Greystripe purchase paying off
*Cloud buzz drives NetSuite shares
*Valuation update: Salesforce.com & Concur
*Intel looks for growth in the Post-PC era
*EMC gets a boost from the cloud
*Tibco Software’s 5 key growth segments
*Behind the surge in Rackspace Hosting shares
*Cornerstone OnDemand emerges in talent management
*TSP Deal Report: Symantec buys Nukona & Odyssey

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Read the latest issue of Tech-Stock Prospector on your Amazon Kindle or your
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Tech-Stock Prospector Managing Editor Rob DeFrancesco has more than 20
years of experience covering the tech sector. He is a former senior writer with
Louis Rukeyser’s Wall Street.

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focused primarily on the networking, storage, security, wireless and software
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