Cloud Winner: NetSuite (N) Continues to Disrupt; Shares Up 53% in 2013 by TechStockProspector


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									                                    Robert DeFrancesco’s
                            Tech-Stock Prospector
January 11, 2014

Cloud Winner: NetSuite Continues to Disrupt; Shares +53% in 2013

After rising 65% in 2012, shares of cloud-based ERP software provider NetSuite (N,
$105.21) last year gained 53%. In October, the stock hit a new all-time high at $114.

One of our 8 TSP Tech Disruptors for 2013 (it made it onto our list of 7 Disruptors
for 2014 as well), NetSuite reported Q3 revenue and billings growth of 34% and
35%, respectively. More impressive, deferred revenue advanced 40% to $189.6

In Q3, NetSuite added more than 320 customers across various verticals. Deal sizes
continued to increase, with the ASP up in excess of 20% year over year.

The company in the September quarter closed a record number of deals worth more
than $250,000 each. Sales of the flagship OneWorld offering accounted for 40%+ of
new business and the number of these deals hit a record level. NetSuite closed one
multi-year deal that was just shy of eight figures, while two other deals each had
recurring revenue of more than $1 million annually.

NetSuite’s latest 2013 guidance (as of the Q3 report): revenue of $410 million to
$411 million, up from previous guidance of $406 million to $410 million and above
the consensus estimate at the time of $409.1 million.

The company also offered its first look at 2014: revenue of $525 million to $535
million, representing ~28.9% growth at the midpoint.

Given that NetSuite continues to snag serious market share from legacy ERP
vendors, this outlook could prove to be conservative

The 2014 consensus revenue estimate of $532.4 million, toward the high end of the
guidance range, indicates growth of 29.6%. The high estimate on Wall Street is all
the way up at $547.2 million.


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Here are some of the topics covered in the January 2014 issue:

*Top potential takeover targets in tech for 2014
*An update on the continued land grab in marketing automation
*How FireEye could spur more cybersecurity M&A
*Might Cisco Systems make a sizable acquisition to help jumpstart growth?
*A small-cap name that’s big in enterprise vulnerability management
*Proofpoint builds its targeted attack prevention business
*New growth drivers for ServiceNow in cloud-based IT management
*Digital-advertising play: Marin Software
*Cornerstone OnDemand stays competitive in talent management
*Qlik Technologies is ready to ride the data visualization wave
*Aruba Networks looks well positioned for the WiFi upgrade cycle
*Adobe Systems continues its move to the cloud
*Behind the big sales force reorganization at Symantec
*Demandware brings the cloud to digital commerce
*Why some savvy money managers like SolarWinds
*Nimble Storage is ready to take on the big legacy vendors
*Wall Street analysts keep boosting their Yahoo price targets
*Is Fortinet primed to execute again after naming a new CFO?
*Deal Report: RetailMeNot sees growth in digital coupons

Order the January 2014 issue of TSP here:

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., launched in 2003, is an investment-research service
focused primarily on the networking, storage, security, wireless and software
sectors. Annual subscription: $350.

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