Splunk (SPLK) Stock Soars on Earnings Beat

Splunk (SPLK) stock is rising in pre-market trading on Friday, after the software company reported its 2015 third quarter earnings results.
By Amanda Albright ,

NEW YORK (TheStreet) -- Splunk  (SPLK) - Get Report stock is surging in pre-market trading by 4.37% to $65.50 on Friday, after the company's fiscal 2016 third quarter earnings results beat analysts' expectations. 

After the market close on Thursday, the San Francisco-based software provider reported earnings of 5 cents per share. Revenue increased 50% year over year to $174.4 million.

Analysts were expecting the company to report earnings of 1 cent per share on revenue of $160 million. 

Splunk raised its fiscal 2016 revenue guidance to $650 million, compared to its previous estimate of $628 million to $632 million. 

Additionally, the company appointed Doug Merritt, the company's senior VP of field operations, as its new CEO effective immediately. 

"We will continue our laser focus on becoming the data fabric for businesses, government agencies, universities, and organizations," Merritt said in a statement. "Our innovative products, outstanding people, and over 10,000 enthusiastic customers form a solid foundation upon which to build our future growth and success."

Separately, TheStreet Ratings team rates SPLUNK INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

We rate SPLUNK INC (SPLK) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and generally disappointing historical performance in the stock itself.

You can view the full analysis from the report here: SPLK

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Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.

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