Amaris duty, LA/Dallas trip, Gigamon analysis
I was on Amaris duty last night til 4am, and frankly it was a blast even though she didn’t sleep much because she was so funny and laughing and kicking and playing peek a boo with me most of the night in between me maintaining her gastro tube feed schedule, suctioning her when her trach tube sounds raspy, and otherwise keeping any eye on her in between cat naps. That was a long sentence. Here’s Amaris reading a book the other day. She can turn the pages herself.
Lyncoln told mom the other day that Daddy is her best friend. Of course, around bed time, she told me that Mommy is her best friend.
I’m ready to rock n roll this Friday though. Speaking of being ready to rock n roll, I got some terrific insights into the economy on my trip through Boston and NYC last month. I’m headed on another trip Sunday night to spend three days in LA for meetings with, among many others, my agent at CAA, Pauly Shore, Carl Reiner (see the IAm apps for iPhone and Android that my company made for those two celebrities and dozens of others), several powerhouse Hollywood managers, producers and publicists. And Thursday morning, I’m flying to Dallas to MC the Chartered Financial Analyst of Dallas Fort Worth Forecast 2017 Dinner with Kathleen Gaffney the Co-Director of Diversified Fixed Income and Portfolio Manager at Eaton Vance Management, Gregory Kraus the Managing Director and Director of Acquisitions at Invesco and James Wicklund the Managing Director of Energy Research at Credit Suisse.
Why so much travel and why do I drop some of those names? Because keeping a finger of the pulse of the world, the economy, the markets and trends is, of course, wildly important. By far one of the biggest values that my long term subscribers tell me they get from my service is that we’ve been bullish and aggressively long near long-term market bottoms like in 2002 and 2009 and we caught the top as I turned bearish and closed my hedge fund in late 2007. I put a lot of pressure on myself to make sure we are ahead of the curve when the next big meaningful crisis/crash/earnings reversal comes and that requires me pounding the pavement and seeing the belly of the economy’s beast. As you know, I continue to think the Bubble-Blowing Bull Market and the economic/market forces that drive it are still in place and on my trip to Boston/NYC last month, that analysis was reinforced and delineated.
Me traveling puts a lot of pressure on my wonderful wife (who is a practicing attorney amongst taking care of the girls and me) and her parents and the caregivers we have who help us with Amaris and I’ll be hustling right back home on Friday.
I also have a new long for the portfolio that I’m finishing up analyzing today and will likely start buying on Monday while I’m on the road. I’ll send you the analysis and details on Monday as I finish up my homework and have a couple calls scheduled today with analysts who cover the name.
Here are my notes from the Gigamon earnings report and conference call. The upshot of my analysis is similar to what it has been — $GIMO has a terrific cloud and network security platform that could have tremendous exponential growth ahead of it if they actually become a de facto standard for many enterprises who are using Google, Amazon and Microsoft cloud solutions. We will find if they can deliver on that promise over the next 12 months. I might nibble a little more if it drops below $30, but otherwise, I’m sitting tight for now.
GIMO Notes:
“In January, six weeks after we launched our AWS product, CME Group, the worlds largest and most diverse derivatives marketplace, selected our AWS visibility platform and became our first Fortune 1000 customer for this new solution. We are excited about our relationship with Amazon and our mutual alignment around the importance of security for the public cloud and this quarter will see us adding our solution to the AWS marketplace…
We are also developing further capabilities for our cloud platform and applications and we’ll be delivering several major enhancements for AWS during 2017, with solutions planned for both Microsoft, Azure and the Google environments, cloud to follow later in the year…
Our customer count grew almost 20% year-over-year to 2300, with repeat purchase multiple of our top 25 customers now impressive 119…
Turning to our three core markets, security, mobility and the cloud. Security threats continue to increase exponentially, while enterprises, service providers and government have invested heavily and reactively in security, tools and applications. The successful attacks continue. We see many companies being more thoughtful and strategic regarding their security investments. We’ve been focused on longer-term platforms rather then point products. The world of security continues to evolve, but free fundamentals drive the demand for new approach…”
And why the stock is down 5% today:
“Our first quarter guidance is not a year-over-year performance you come to expect from Gigamon. Before we take questions. I want to address a few points regarding Q1 and the full 2017 year. We continue to lead our market. We’ve been taking share from our competitors for the last two years and we expect to do so in 2017…
Our guide for Q1 is light, of a tough prior year comparison, but our goal is for Q2 to be a glide path to act above visibility market growth rates in the second half of 2017. During the year, we plan to continue our investments in sales and marketing and R&D, albeit at a more measured pace. While we recognize that the continued investment will impact operating margin during the year, we firmly believe that the significant amount of both electrical and geographic white space around us represents all the ingredients that we need to return to a historical growth rate ahead of the visibility market…
We remain very excited about our public cloud solution for which we have several significant and valuable enhancements planned in the next 12 months. We plan the continued extension of our platform and applications for the security market, with major launches scheduled during ’17.”
