Box Inc's “platform” is underappreciated by investors

Published By: Eunice Gettys on January 11, 2017 01:48 pm EST

Box Inc. (NYSE:BOX) has been reaffirmed at Overweight by Pacific Crest analyst Rob Owens, who met with the key management personnel of the company earlier this week. The analyst believes that the assets of Box are currently underappreciated by the investors and the stock is trading at a discount to its fair price. The analyst expects encouraging growth numbers from the company’s cloud platform and believes that it could drive both top and bottom like upside during the year 2017.

Rob Owens hosted two of the key executives of the company for a meeting earlier this week. Among the two executives from Box, one was the Senior Vice President of Platform and Chief Strategy Officer Mr. Jeetu Patel, while the other was Chief Financial Officer and Co-Founder of Box, Mr. Dylan Smith. The focus of the meeting was the identification of key growth drivers for the company and future of Box as a cloud services platform.

The cloud platform of the company is still in its early days and a lot needs to be done before it is able to carry the company forward. Currently the software as a service (SaaS) platform of the company only represents less than 10% of the total revenue, but it is one of the reasons why Box has such a large number of enterprise customers. It allows the enterprises to share their enterprise data with their partners and customers in a secure and controlled manner. The management of the company remains dedicated to growing the platform and has employed 80,000 developers in order to grow the said platform.

The analyst reaffirmed his overweight rating on the stock with a price target of $21. The analyst ratings for the company are four buys, four outperforms and five holds. The stock currently trades at a price of $16.28 and has gained 5.04% since the open.