Tableau Stock: Surfing Ahead on the Wave of Big Data

data stock
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DATA Stock Gearing Up for the Challenges Ahead

Today’s stock represents one of our favorite strategies of investing in growth stocks. Investing in the stocks that stand to gain from the rise of the digital and connected economy may translate into superlative returns for the investor. As enterprises struggle to deal with the increasing amount of data in this kind of economy, companies that simplify their struggle stand to gain a lot.

Case in point being Tableau Software Inc (NYSE:DATA), which builds software to put the power of data into the hands of everyone. It makes it easy for everyone to engage with their data, ask the right questions, and solve problems. With the mission of helping people see and understand data, Tableau Software helps everyone quickly analyze, visualize, and share information, which is a strong foundation for the growth of Tableau stock in the coming years.

In a world where data has become the new oil, Tableau Software products help in representing a huge volume of data in a way that is easily understood and acted upon by others. Its software solutions are transforming the way people use data to solve problems and the company makes analyzing data fast, easy, and beautiful.  

This is one area bound to benefit from the proliferation of data in our lives. And data visualization tools shall be in great demand as people with no technical background can easily work with the software, without getting lost in the large data sets. Data visualization helps in simplifying the process of deriving analytical results from visual information.

Per a research report by Orbis Research, the Global data visualization applications market is currently valued at $4.12 billion and is likely to grow at a CAGR of 9.21%, to reach $6.99 billion by the end of 2022. (Source: “Global Data Visualization Market,” Orbis Research, January 12, 2017.)

Tableau Software is well-positioned to capture this trend. Its products can be used by people with diverse skills across all types of organizations, which also include Fortune 500 corporations, small-, and medium-sized businesses, universities, government agencies, and many more. Tableau’s products are employed in a broad range of use cases such as increasing sales, improving customer service, streamlining operations, managing investments, assessing quality and safety, studying and treating diseases etc.

DATA stock had suffered when the company announced its third-quarter results last month. Total revenue grew to $214.9 million, an increase of four percent year-over-year. The company is making the transition to subscription and witnessed a strong momentum in its subscription offering. More and more customers are turning to this model to lower their upfront cost. However, the results turned out to be below expectations due to these changes taking effect. Tableau stock should start looking up again once the transition stage is through.

During the quarter, the company acquired ClearGraph, which is a startup that enables smart data discovery and data analysis through natural language query technology.

Tableau added over 4,000 new customer accounts in the quarter, taking the total number around the world to more than 65,000, as the demand for analytics continues to grow. Some of the company’s largest customers include Verizon Communications Inc. (NYSE:VZ), Cisco Systems, Inc. (NASDAQ:CSCO), Deloitte, and various U.S. government agencies.

Given the high growth expected in the data visualization space and the future potential of the company, DATA stock has been gaining and is up more than 65% in the past year. The following Tableau stock chart shows this rise.

data stock

Chart courtesy of StockCharts.com

Analyst Take:

With the mission of helping people see and understand data, Tableau Software helps everyone with data and questions. Tableau is helping to democratize the use of business analytics software by allowing people to access information, perform analysis and share results without assistance from technical experts, which accelerates the pace of informed and intelligent decisions and enhances business productivity.

We are just beginning to grasp the magnitude of improvements that we can make to our lives by making better use of data. Tableau software helps in tapping these opportunities in disease research, industrial efficiency, education patterns etc. And the rising demand for such services shall keep DATA stock flying high. Investors convinced about the need to make data simple and understandable should not overlook the stock.