Nutanix has a unique product in the cloud computing market. It combines standard server functions with virtualization and AI in its software platform. This approach is paying off handsomely. On Monday the Relative Strength (RS) Rating for Nutanix stock shot up 11 points from 70 to 81, topping a key milestone along the way.
History shows that the best stocks typically have an 80 or higher RS Rating as they launch their biggest climbs. Small-cap Nutanix just passed that milestone and joined that exclusive club. It remains to be seen, but the stock watchlist candidate could be a diamond in the rough.
Nutanix Stock A Favorite Among Big Money Investors
On its website, Nutanix says its platform uses artificial intelligence to enable various technologies to work together. It says it provides "cost-effective business continuity through unified management, one-click operations, and AI-driven automation." The San Jose, Calif.-based company counts among its 23,000 clients Home Depot, AAA, Vodaphone, Toyota Motor, Airbus and other large and small enterprise customers.
Its other key ratings are mixed. Nutanix company has a so-so 67 Earnings Per Share Rating and Nutanix stock has a bit stronger 77 Composite Rating.
Where it shines though is its B- Accumulation/Distribution Rating, a gauge of institutional buying. The B- rating on an A+ to E scale, with A+ superb and E dismal, shows that big money investors are buyers, a bullish sign. Also, the number of top-rated funds that own Nutanix shares rose from 440 in September to 507 in December and 528 in March.
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Nutanix stock traded at 13.51 at the end of May 2022. In the past year its stock has climbed about 93% and it was trading above 26 Monday afternoon. It's not currently offering a proper buying opportunity. See if the stock goes on to build a promising base like a cup with handle or three-weeks-tight pattern that could ignite a fresh run.
Good Quarter — Can It Keep It Up?
Nutanix reported a 3-cent profit last quarter, reversing from a 22-cent loss the same quarter last year. Technically, that's a 114% increase. Revenue climbed 15% in its most recent quarter to $433.6 million. The next quarterly results are expected on or around May 25. Note that its earnings have been erratic until last quarter. The small earning growth was its first growth in the past four quarters. It isn't clear yet whether it's achieved a turnaround.
Nutanix stock holds the No. 27 rank among its peers in the Computer Software-Enterprise industry group. Dynatrace and Qualtrics International are among the group's highest-rated stocks.
When looking for the best stocks to buy and watch, keep a close on eye on relative price strength.
IBD's unique Relative Strength Rating tracks market leadership with a 1 (worst) to 99 (best) score. The rating shows how a stock's price behavior over the last 52 weeks holds up against all the other stocks in our database.
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