Shares of big data analytics and systems monitoring expert Splunk (NASDAQ: SPLK) rose 10.8% in December 2022, according to data from S&P Global Market Intelligence. The jump hinged on an impressive earnings report at the end of November, which inspired a 17.8% surge on Dec. 1. However, the rest of the month was dominated by macroeconomic swings that didn't leave much distance between Splunk's stock performance and the broader market's.

Splunk's third-quarter report showed 40% year-over-year sales growth while the bottom line swung from a small loss to a robust profit. Adjusted earnings of $0.83 per share more than tripled your average Wall Street analyst's estimate, and the top-line reading of $930 million exceeded the analyst consensus by 10%. Cloud-based sales increased even faster at a 54% clip and accounted for 32% of Splunk's total revenues (up from 23% a year ago).

Several analysts celebrated Splunk's robust growth and successful migration onto a cloud-based platform while noting that the company's clients have limited budgets for expanding their systems monitoring efforts. Hence, Splunk saw bullish analysts reducing their target prices on the stock even though their "buy" ratings were untouched.

Continue reading

Source Fool.com