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Western Digital to Power SAP HANA Platform With IntelliFlash

Zacks Equity Research

Western Digital WDC recently secured certification to provide SAP’s SAP SAP HANA platform with robust all-flash arrays IntelliFlash portfolio of enterprise storage solution.

IntelliFlash portfolio will be integrated with SAP HANA’s in-memory data processing capabilities to facilitate business-critical applications with enhanced performance, flexibility and efficiency.

The company’s IntelliFlash portfolio will enable SAP HANA customers to accelerate business processes with robust workloads handling capabilities. SAP HANA users can reduce costs and provide enhanced predictive analytics solutions in real time.

The company’s IntelliFlash portfolio will aid SAP HANA enterprise users with massive data consolidation, scaling to petabytes “onto a single platform.” This will streamline data management processes.

Moreover, SAP HANA users can accelerate online analytical processing (OLAP) and online transaction processing (OLTP) processes by utilizing low latency and extreme throughput capabilities of IntelliFlash.

Growing adoption of SAP HANA platform, worldwide, is expected to boost the prospects of the latest integration. Expanding enterprise clientele is anticipated to aid Western Digital in enhancing competitive position in enterprise storage market against Seagate and NetApp, among other storage peers.



Moreover, robust adoption of the company’s solutions is instilling confidence in the stock. Notably, shares of Western Digital have returned 42.4% year to date, outperforming the industry’s rally of 12.3%.

Key Features of IntelliFlash

Western Digital’s IntelliFlash systems offer robust performance for broad based enterprise workloads. The series leverage IntelliFlash OS 3.9 in the range of 19TB to 1.3PB of solid-state storage.

Additionally, Version 3.9 provides a comprehensive suite of capabilities comprising data reduction, multiple protocols, automated data healing and data protection.

Growth Prospects Aplenty

Emerging applications including the likes of AI, IoT, and machine learning (ML) tools call for a robust storage system. Notably, per recent IDC estimates, the global datasphere will grow to 175 zettabytes (that is a trillion gigabytes) by 2025, from 33 zettabytes in 2018. The effective storage is absolutely essential to properly harness this data which is where Western Digital’s IntelliFlash solutions come in handy.

Further, Western Digital is investing heavily to deliver high-capacity data center storage devices that support expansion of cloud infrastructure and cloud applications in order to address ongoing acceleration in cloud deployments. In fact, per IDC data, global spending on public cloud services and related infrastructure is envisioned to hit $210 billion in 2019, up 23.8% over 2018.

We believe, solid adoption of flash-based products — on the back of increase in capacity enterprise products, and demand for data center devices and cloud solutions — favors adoption of IntelliFlash porfolio.

Risks Remain

Customer concentration and a leveraged balance sheet remain major concerns limiting the near-term growth prospects of Western Digital.

Zacks Rank & Key Picks

Currently, Western Digital carries a Zacks Rank #3 (Hold).

Some better-ranked stocks worth considering in the broader sector are Alteryx AYX and Rosetta Stone RST, both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The long-term earnings growth rate for Alteryx and Rosetta Stone is pegged at 13.7% and 12.5%, respectively.

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