DATA is a first mover in Big data analytics industry, which is expected to grow by at least 25% until 2018 to $46 Billion (source ReportsnReports.com). Investment bank Cowen and Co. expects Tableau to capture 30% of business intelligence license market by 30%. According to Tableau's website, total data volume will reach 20 Exabytes by 2020, growing by 48% annually.
Companies like Microsoft and IBM have already realized the potential of this business and are developing or have already launched their own products. While they have larger resources than Tableau, no big data analytics company grows revenues and acquires customers as fast as Tableau. They are reinvesting all money into sales and R&D as can be seen on their financials:
Why I'm going long
Tableau offers free trials on most of their products, so customers can try them out easily and decide whether to pay for more or not. Vast majority of accounts expand over time, which demonstrates that the software is popular and can spread quite quickly. Revenues are growing quickly, and Wall Street has noticed this stock some time ago, which is also reflected in it's valuation. DATA has demonstrated innovation and acquires customers at an incredible pace. Their customer conference, which is meant to build a community of enthusiasts and get feedback for their products had 180 attendees in 2008, and 5500 in 2014. At the end of last year, Tableau had 13 patents issued for their software and 25 more pending. One big risk is their issuance of stock, last year they increased number of shares outstanding by 11%, what's always a big risk in technology stocks.
I believe the company has a lot of market potential with current products, plus can develop market leading software for the future. Going long today at open with a stop loss like I always do (wouldn't recommend buying this stock without SL).