Gigamon (GIMO, $30.20) shares this morning are off more than 16% on weak Q2 guidance calling for revenue of $69 million to $73 million, below the consensus estimate of $78.6 million. 

In January, Gigamon, a provider of networking visibility solutions, pre-announced negative Q4 results, blaming lower than expected product bookings in North America. 

While last night’s Q1 numbers topped expectations, product revenue declined 1% and total revenue rose less than 4%.

Digital video ad revenue in 2016 totaled $9.1 billion, up 54% from $5.9 billion in the previous year, according to the Interactive Ad Bureau. Mobile video ad revenue was up nearly 150% to $4.2 billion.

Total online ad revenue last year rose 22% to $72.5 billion. Mobile accounted for more than half of all online ad revenue for the first time ever.

Credit Suisse starts coverage of Salesforce (CRM, $85.96) at ‘Outperform’ with a price target of $110 based on significant cash flow potential, unlocked by sustainable revenue growth. The firm sees continued market share gains, ample cross-sell/up-sell opportunities and encouraging expense discipline.

Also, Benchmark starts Salesforce at ‘Buy’ with a price target of $100.

Ultimate Software (ULTI, $200.05) shares this morning are off more than 5% because of lighter than expected Q2 revenue guidance: $228 million, vs. the consensus of $231.5 million. 

But the provider of cloud-based HCM solutions maintained its full-year guide calling for revenue growth of 24%, indicating a strong 2H.

Ultimate’s Q1 revenue rose 22%, driven by 24% growth in recurring revenue.

RBC Capital downgrades Shopify (SHOP, $73.76) to ‘Sector Perform’ with a price target of $77 based on valuation. The firm believes plenty of good news is already embedded in the current price, while recent initiatives will take time to have an impact on the business model.

Shopify shares on Monday hit a new all-time high at $78.19.

Ahead of the release of Q1 results tomorrow after the close, ServiceNow (NOW, $90.20) stock, now back above its 50-day moving average of $87.92, has pushed through short-term resistance at $89.47. 

The all-time high of $94.72 was reached in February.

Wedbush raises its Amazon (AMZN, $907) price target to $1,250 from $900, saying the company appears intent upon growing annual profits. 

The firm believes AWS “should be the growth engine, with its gross and operating margins expanding rapidly.” 

Wedbush cautions that spending on video content, fulfillment and international expansion could put some pressure on margin expansion.

Wedbush lifts its Shopify (SHOP, $75.65) price target to $85 from $75 because it expects the company to continue to grow at a rate above the overall e-commerce market thanks to increased penetration of its SMB TAM and further expansion with larger brands.

The firm believes current expectations for Q1 total customer count could be too low. Shopify ended Q4 with more than 375,000 customers.

For more on Shopify, see the April 2017 issue of Tech-Stock Prospector (TSP #182).

Stifel upgrades Gigamon (GIMO, $36.35) to ‘Buy’ and raises its price target to $42 from $30, saying the shares offer an attractive risk/reward balance at current levels. 

The firm believes recent missteps (disappointing Q4 results and Q1 guidance) were temporary, citing: (1) the 100G upgrade cycle; (2) disruption at the competition; and (3) favorable government trends aiding growth.

Shares of Twilio (TWLO, $31.99) continue their rebound off of the April 6 low of $26.76. 

The upside momentum has driven the stock above the downtrend line from the February high of $34.95.

The shares are now comfortably above the 50-day moving average of $30.72. The 200-day moving average stands at $38.72.

Baird downgrades Proofpoint (PFPT, $72.28) to ‘Neutral’ and reduces its price target to $77 from $92 ahead of the release of Q1 results after the close.

The firm says recent industry feedback suggests sales execution challenges at Proofpoint have accelerated. Thus, Baird has become increasingly concerned regarding 2017 revenue guidance.

Proofpoint shares this morning are down nearly 7%.

Pacific Crest is bullish on Alteryx (AYX, $16.32), provider of cloud-based self-service data analytics software, initiating coverage at ‘Overweight’ with a price target of $20.

The company went public in March at $14 a share and opened for trading at $17.25.

Pacific Crest says Alteryx has an attractive subscription model with high retention rates and product expansion opportunities in advanced analytics.

For more on Alteryx, see the April 2017 issue of Tech-Stock Prospector (TSP #182).

DA Davidson upgrades Proofpoint (PFPT, $76.93) to ‘Buy’ and raises its price target to $90 from $83, saying its checks have consistently revealed that email and social engineering threats are considered the biggest security challenges.

The firm believes the relative underperformance of Proofpoint shares since October has created an attractive entry point.

Ahead of the release of Q1 results, Credit Suisse raises its Facebook (FB, $140.78) price target to $175 from $170 based on strong momentum in the ad business. 

In addition, the firm increases its ad volume growth estimates for 2H’17 from what it felt was an excessively conservative level.

Guggenheim names Ultimate Software (ULTI, $203) a best idea, starting coverage  at ‘Buy’ with a price target of $230. 

The firm says Ultimate has quietly built a top global franchise in HCM, generating best-in-class operating profits while growing revenue 20%+ annually.

RBC Capital is positive on ServiceNow (NOW, $84.99), saying the stock has reached a good entry point following its pullback since late February on news of the CEO transition. The firm believes ServiceNow is experiencing improving fundamentals.

From the all-time high of $94.72 reached on February 15, the shares dipped to a low of $83.42 on March 27. 

Shares of Rapid7 (RPD, $16.18) rose more than 9% yesterday after the provider of cloud-based security solutions said it expects Q1 revenue to come in at or above the high end of its prior guidance range of $42.6 million to $44 million.

The firm also reiterated its 2017 revenue guide of $192 million to $198 million on billings of $224 million to $234 million.

Morgan Stanley thinks the market is not fully appreciating the move into the enterprise market by RingCentral (RNG, $28.60), provider of cloud-based communications systems for businesses. 

The firm upgrades the stock to ‘Overweight’ with a price target of $33, saying the enterprise push should begin to pay off for RingCentral this year. 

Yesterday, the stock hit a new all-time high at $29.

We profiled RingCentral in October 2015 (TSP #164), when the shares were trading around $18.50.

At the time, we wrote:

One big positive trend behind ARPU growth is RingCentral’s move up-market to server a greater number of larger enterprise accounts. 

Pacific Crest upgrades Yelp (YELP, $33.58) to ‘Overweight’ with a price target of $43 based on positive checks with local ad customers that indicate the company’s core franchise is healthy and appears insulated from larger competitors (Google & Facebook).

The firm says more than $60 billion of offline local ad spending is shifting toward online, and Yelp remains well-positioned to capitalize on this trend. Pacific Crest thinks investors are under-appreciating Yelp’s local ad business.

Citi thinks the recent pullback in NVIDIA (NVDA, $110.10) shares is a buying opportunity. The firm says concerns about gaming market saturation have been overdone. Citi maintains its price target of $145.

In early February, NVIDIA shares hit an all-time high of $120.92.

Monness Crespi, Hardt & Co. starts coverage of Palo Alto Networks (PANW, $109.69) at ‘Buy’ with a price target of $150 based on valuation. 

The firm believes improving execution and a potential re-acceleration of growth in FY’18 will drive multiple expansion and additional market share gains.

While there has been moderation in cybersecurity spending from recent peaks, the firm believes IT security remains a priority and that Palo Alto is well-positioned in the firewall segment.

Piper Jaffray remains confident that Netflix (NFLX, $145.50) will be able to achieve its estimate of 12.5% international Internet household penetration by 2020. 

In a recent survey of 1,000 Internet households in seven international markets that had Netflix available for an average of four years, 37% of respondents said they are current Netflix subscribers, with an additional 13% indicating they expect to be subscribers within the next six months. 

The firm maintains its NFLX price target of $166.

Pacific Crest downgrades NVIDIA (NVDA, $108.38) to ‘Underweight’ based on signs of desktop GPU market saturation, lower margins from incremental Nintendo Switch revenue and a possible pause in the company’s datacenter business this summer.

The firm says desktop GPU demand slowed in Q1, particularly in China and the U.S.

BMO Capital lifts its Amazon (AMZN, $891.51) price target to $1,200 from $900, saying it sees the company’s advertising business as a significant new growth opportunity. For 2017, the firm estimates Amazon’s ad business will hit $3.5 billion in revenue. 

The high-margin ad revenue can be a greater catalyst for the stock if Amazon management shares more data points about it, says BMO.

Stifel downgrades Arista Networks (ANET, $132.27) to ‘Hold’ based on valuation. The stock is up 50%+ since the middle of November.

The firm raises its price target to $135 from $130, saying it maintains a positive view on Arista’s competitive differentiation in the datacenter networking space and the company’s long-term ability to adjacently expand into the edge router market.