Growth in Enterprise Software Space Due to Big Data, Cybersecurity and Cloud: A Wall Street Transcript Interview with Daniel Ives, a Managing Director in the Technology, Media and Telecom Research Group of FBR Capital Markets

Wall Street Transcript

67 WALL STREET, New York - November 11, 2013 - The Wall Street Transcript has just published its Business and Application Software Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Cloud Computing Secular Trends - International Enterprise and Consumer Demand - Application Software Consolidation Activity - Cloud Computing and SaaS Trends - Health Care Transition to ICD-10

Companies include: Red Hat Inc. (RHT), Citrix Systems, Inc. (CTXS), Oracle Corp. (ORCL), International Business Machine (IBM), DATATRAK International, Inc. (DATA), EMC Corporation (EMC), Cisco Systems, Inc. (CSCO), Sourcefire, Inc. (FIRE), Check Point Software Technolog (CHKP), NICE Systems Ltd. (NICE) and many others.

In the following excerpt from the Business and Application Software Report, an experienced research analyst discusses the outlook for the sector for investors:

TWST: What macro trends, including developments for their customers, are creating opportunities for enterprise software companies at this point?

Mr. Ives: I think it's been a pretty uneven macro environment in terms of spending. I think that's in part the problem as you've seen over the last few months with soft numbers at Red Hat (RHT), Citrix (CTXS), Oracle (ORCL) and most recently IBM (IBM) on the software side. You are seeing strength out of Big Data, cybersecurity and then move to the cloud, but overall it's tight budgets and it's a tough large deal environment.

TWST: You just mentioned Big Data, which lately we've been hearing a lot about. What is happening on that front, and which of your companies do you expect to be the biggest beneficiaries?

Mr. Ives: I think part of it is added to new evolution technology companies that are really focused on the next layer of analytics around Big Data as data evolves, structured or unstructured data, and the need to get analysis in real time for enterprises has driven this need for the technology. I think when you think about who are pure Big Data names, Splunk (SPLK), Tableau (DATA), Qlik (QLIK), and then also a few guys like EMC (EMC) that kind of play into the Big Data trend, there is a pretty finite group of companies that play into Big Data. And I think that speaks to why you see some pretty high valuations among some of these vendors, because it's a scarcity value, and investors want to participate in the growth cycle.

TWST: You just mentioned Splunk, and I wanted to ask you about that company. You upgraded that stock in August. Aside from the Big Data factor, what else contributed to your rating change, and what do you like about the company at this point?

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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