U.S. Markets closed

Splunk jumps on strong 3Q results and 4Q forecast

NEW YORK (AP) -- Shares of Splunk climbed to an all-time high Friday after the software company reported strong third-quarter results and gave a solid outlook for the current quarter.

THE SPARK: Splunk said that when one-time expenses were stripped out, it broke even during the August-October quarter, while revenue rose 51 percent to $78.6 million. Analysts expected a loss of 1 cent per share and $71.1 million in revenue, according to FactSet.

Splunk expects to report $88 million and $90 million in revenue in the current quarter, which topped analysts' prediction of $86.1 million.

THE BIG PICTURE: Splunk Inc. makes software that helps companies and other organizations collect and analyze internal data. The San Francisco company said it gained 450 new customers during the quarter, bringing its total to 6,400.

THE ANALYSIS: Canaccord Genuity analyst Richard Davis said the company is executing well, and he believes it will continue to do so. He noted that Splunk is reporting a steady increase in orders worth $100,000 or more. He rates the shares "Buy" and raised his price target to $72 from $68.

Cantor Fitzgerald analyst Brian White also maintained a "Buy" rating and raised his price target to $77 per share from $70.

SHARE ACTION: Splunk stock rose $12.82, or 21 percent, to $72.72 in afternoon trading Friday. The shares went as high as $74.76 earlier in the day. Splunk went public in April 2012 at $17 per share.