Last week Zscaler (ZS) ripped to a new high on strong earnings. Today, it’s Pivotal Software’s (PVTL) turn.
PVTL rose about 25 percent in morning trading to a new high after subscription revenue shot up 69 percent. Profit beat. Revenue beat. Guidance wowed.
Never heard of ZS or PVTL? Not surprised. Neither company has traded in public markets for longer than three months.
Both offer investors exposure to the fast-growing world of cloud computing. Simply put, billions of dollars’ worth of IT business is shifting from older systems that people and enterprises owned to remote servers run by third parties like Amazon.com (AMZN) or Alphabet (GOOGL). This migration creates huge opportunities for new kinds of software and services.
PVTL, for instance, has a platform for developing software uniquely in “the cloud.” It also benefits from close ties with data-center pioneers EMC and VMware (VMW). ZS provides security services. After all, with so many people logging in and out of remote systems, you really need to control access.
We have repeatedly covered cloud computing on the Market Insights blog. Click here for our most recent special report. In tandem with Chinese techs, they’ve helped drive an IPO buying frenzy this quarter.
By the way, several other cloud stocks have been around longer than the new ones. Nutanix (NTNX) and Palo Alto Networks (PANW) are shooting higher after being cited on Monday’s Morning Market Briefing. Chart watchers today may want to view Splunk (SPLK) as the data miner tries to breech a resistance level around $119 from last month. After beating and raising in its last report, is SPLK on breakout watch?