Barclays sees Salesforce-type of opportunity in Splunk shares

Barclays analyst Raimo Lenschow thinks investors should revisit the Splunk (SPLK) story. The company has a poorly optimized profit structure that new management is addressing, the analyst tells investors in a research note. The firm believes Splunk’s opportunity is not dissimilar to Salesforce (CRM) in recent months. Splunk’s recent changes on the go-to-market side, which includes refocusing on security, outcome selling, and a single seller model, should stabilize its growth and limit future discussions around the long-term outlook, contends Barclays. As such, it believes Splunk represents an “interesting asset that could deliver solid growth with significant margin upside.” This opportunity is not priced correctly at current share levels, says the firm, which keeps an Overweight rating on the shares with a $130 price target.