F5 Integrates With VMware To Enhance Its Network & Security Program

by Trefis Team
-0.93%
Downside
119
Market
118
Trefis
FFIV
F5 Networks
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F5 Networks (NASDAQ:FFIV), a provider of application delivery network, recently announced the integration of its BIG-IP products with VMware, a provider of virtualization and cloud infrastructure, to offer a combined solution for networking and security programs for its customers. F5 Networks will use the new VMware Ready program to automate key application delivery services. The new VMware software enables customers of all sizes to continue utilizing their existing investments in networking and security products, while benefiting from efficiency and agility of the VMware cloud infrastructure through validated joint solutions.

By helping to quickly locate certified solutions, the program allows the customers to lower their operational costs and management complexity and meet their compliance requirements. As a launch partner for VMware Ready for networking and security program, F5 expects to enhance the capability of the VMware software, enabling professionals to efficiently deploy and optimize application delivery services across virtualized and cloud environments.

F5 Networks currently holds around 27% share in the application delivery network market, and we believe it is capable to pull up its share to 38% by the end of our forecast period.

See our complete analysis for F5 Networks here


Shift To Cloud Based Services and Storage Will Benefit F5

Organizations are transforming their own data centers and are turning to external, third-party cloud providers for services and storage to lower their capital and operating costs. To accommodate the dynamic needs of their clients, cloud providers are building large virtualized data centers to host a constantly changing mix of on-demand resources.

Enterprises are pursuing increasingly responsive IT deployment models and the recent F5 and VMware collaboration looks to provide technologies that make software defined data centers a reality. The integration will take advantage of the services available with the BIG-IP product line such as load balancing, SSL offloading, web application firewall etc., helping integrate application services into data center operations.

Research firm Forrester projects the global market for cloud computing to increase from $41 billion in 2011 to $241 billion by 2020. [1] We believe that F5 Networks is well-positioned to leverage this growth.

Our price estimate of $135 for F5 Networks is at a premium of over 30% to the current market price.

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F5 Networks Reaches $128 With Shift To Cloud

by Trefis Team

+38.05%
Upside
92.46
Market
128
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FFIV
F5 Networks
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F5 Networks (NASDAQ:FFIV), the application delivery heavyweight, helps companies simplify the management of their data center operations and delivery of services across diverse data center resources. It has pioneered the load-balancing technology that distributes internet traffic evenly across multiple servers, making them look like a single device. Optimizing growth in the application delivery network market, F5 has almost doubled its revenues and profits in the last 5 years.

The stock has lost around 20% of its market value in the last month. However, with a robust pipeline of future sale opportunities, we believe the company’s leadership to be as strong as its ever been. Here, we analyze certain prominent trends that shape the future prospects and in turn support our valuation of $128 for the company, which stands at a premium of 20% to the current market price.

See our complete analysis for F5 Networks here

Shift To Cloud Based Services and Storage

Notes:
  1. More Predictions on the Huge Growth of Cloud Computing, Wall Street Journal, April 21, 2011 []
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