F5 Networks, Inc. (NASDAQ:FFIV) was downgraded by equities researchers at Oppenheimer Holdings, Inc. from an “outperform” rating to a “market perform” rating in a research report issued to clients and investors on Thursday. They presently have a $120.00 price target on the network technology company’s stock, down from their prior price target of $145.00. Oppenheimer Holdings, Inc.’s price objective would indicate a potential downside of 1.41% from the stock’s previous close.
The analysts wrote, “Coupling this with persistent macro (EMEA), challenges leave us in search of fundamental catalysts to drive F5’s shares higher through earnings upside or multiple expansion,” Oppenheimer said. That said, the firm sees the downside being limited by aggressive share repurchases, potential dividends, and Operating expenditure controls/ management.The firm revised its estimates, to reflect the second quarter results and the guidance.Trio Of Concerns: Product Growth, Leverage, Lack Of Catalysts Wells Fargo analyst Jess Lubert attributed his downgrade to his view that product growth is unlikely to accelerate anytime soon, expecting it to decline over the next three quarters. While stating that F5 Network’s stock performance is highly correlated to the trend in its product growth, the analyst said stock performance wouldn’t improve if product growth fails to kick off.Additionally, Lubert believes the company might leverage its balance sheet to fund M&A, adding risk to the model.Thirdly, the analyst sees a lack of catalysts required to reaccelerate growth or rerate the company’s shares.”if F5’s customers increasingly shift assets to the public cloud or purchase SaaS rather than on premise software offerings, we think there is likely less of a need for F5’s application delivery services, which may impact company growth over the next few years,”
A number of other equities research analysts have also weighed in on the company. Wells Fargo & Company lowered F5 Networks from an “outperform” rating to a “market perform” rating and lowered their target price for the company from $145.00 to $120.00 in a research note on Thursday. Citigroup Inc. lowered F5 Networks to a “market perform” rating in a research note on Thursday. Piper Jaffray Companies lowered their target price on F5 Networks to $121.00 and set a “neutral” rating for the company in a research note on Thursday. Robert W. Baird reissued a “hold” rating on shares of F5 Networks in a research note on Thursday. Finally, BidaskClub lowered F5 Networks from a “sell” rating to a “strong sell” rating in a research note on Tuesday. Two equities research analysts have rated the stock with a sell rating, fifteen have given a hold rating and five have given a buy rating to the company. The stock presently has an average rating of “Hold” and a consensus price target of $132.00.
F5 Networks (NASDAQ:FFIV) traded up 2.27% during trading on Thursday, reaching $121.72. The company’s stock had a trading volume of 1,458,511 shares. F5 Networks has a 52-week low of $114.45 and a 52-week high of $149.50. The stock has a 50-day moving average price of $127.78 and a 200 day moving average price of $135.13. The company has a market cap of $7.73 billion, a PE ratio of 20.22 and a beta of 1.17.
F5 Networks (NASDAQ:FFIV) last released its earnings results on Wednesday, July 26th. The network technology company reported $2.03 earnings per share for the quarter, meeting analysts’ consensus estimates of $2.03. F5 Networks had a return on equity of 33.85% and a net margin of 18.96%. The company had revenue of $517.80 million during the quarter, compared to analyst estimates of $525.57 million. During the same quarter in the previous year, the company posted $1.81 EPS. F5 Networks’s revenue for the quarter was up 4.3% on a year-over-year basis. On average, analysts expect that F5 Networks will post $8.18 EPS for the current year.
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In related news, Director John Mcadam sold 10,000 shares of the firm’s stock in a transaction on Wednesday, May 10th. The stock was sold at an average price of $130.17, for a total value of $1,301,700.00. Following the transaction, the director now directly owns 66,953 shares of the company’s stock, valued at approximately $8,715,272.01. The sale was disclosed in a legal filing with the SEC, which is available through the SEC website. Also, EVP Ryan C. Kearny sold 846 shares of the firm’s stock in a transaction on Monday, May 1st. The stock was sold at an average price of $127.95, for a total value of $108,245.70. Following the completion of the transaction, the executive vice president now directly owns 1,071 shares in the company, valued at $137,034.45. The disclosure for this sale can be found here. Insiders have sold a total of 25,146 shares of company stock worth $3,234,190 over the last three months. Insiders own 0.26% of the company’s stock.
A number of institutional investors have recently made changes to their positions in the company. BlackRock Inc. boosted its position in shares of F5 Networks by 2,108.1% in the first quarter. BlackRock Inc. now owns 4,404,873 shares of the network technology company’s stock worth $628,003,000 after buying an additional 4,205,384 shares in the last quarter. Morgan Stanley boosted its position in shares of F5 Networks by 171.1% in the first quarter. Morgan Stanley now owns 829,117 shares of the network technology company’s stock worth $118,207,000 after buying an additional 523,250 shares in the last quarter. Bank of Montreal Can boosted its position in shares of F5 Networks by 36.8% in the first quarter. Bank of Montreal Can now owns 1,745,173 shares of the network technology company’s stock worth $248,809,000 after buying an additional 469,449 shares in the last quarter. Los Angeles Capital Management & Equity Research Inc. boosted its position in shares of F5 Networks by 3,947.5% in the first quarter. Los Angeles Capital Management & Equity Research Inc. now owns 366,821 shares of the network technology company’s stock worth $52,298,000 after buying an additional 357,758 shares in the last quarter. Finally, Old Mutual Global Investors UK Ltd. boosted its position in shares of F5 Networks by 30.3% in the first quarter. Old Mutual Global Investors UK Ltd. now owns 933,496 shares of the network technology company’s stock worth $133,088,000 after buying an additional 216,959 shares in the last quarter. 94.88% of the stock is currently owned by institutional investors.
About F5 Networks
F5 Networks, Inc is a developer and provider of software defined application services. The Company is engaged in the development, marketing and sale of application delivery networking products that optimize the security, performance and availability of network applications, servers and storage systems.
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