CTXS - Embedded Expectations Analysis - 2018 11 09
Citrix Systems, Inc. (CTXS:USA) currently trades near corporate averages relative to UAFRS-Based (Uniform) Earnings, with a 20.9x Uniform P/E. At these levels, markets are pricing in muted expectations for the firm, and while management has concerns about demand, unbilled revenue, and networking revenue, potential market tailwinds and the firm's leadership position in the space suggest longer-term upside remains warrantedSpecifically, management may lack confidence in the sustainability of the current demand environment, and may be concerned about their increasing unbilled revenue levels. Additionally, they may be concerned about their stagnant networking revenue in Q3, and weak year-over-year revenue growth. Moreover, they may lack confidence in their ability to maintain current direct sales levels, and to increase their large transaction volume with their existing customers. That said, the firm maintains a leadership position in a space with continued tailwinds, suggesting muted market expectations are overly bearish, warranting further upside
Citrix Systems is an enterprise software company. The company markets and licenses its solutions through multiple channels worldwide, including selling through resellers, direct and over the Web. The company's partner community comprises thousands of value-added resellers known as Citrix Solution Advisors, value-added distributors, systems integrators, independent software vendors, original equipment manufacturers and Citrix Service Providers. The company provides solutions and services that it categorizes into three inter-related and complementary areas: Workspace, Networking and Professional Services.
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