F5 Networks (FFIV, Financial) should benefit from its product refreshment going forward. F5 realises tremendous growth prospects attached with the product and service refreshment for its existing as well as new clients. In addition, the company remains on track to introduce various enhancements and invest in innovative technology that should augment its growth in the future. It has observed strong growth across its business in the last reported quarter and expects this growth momentum to translate into fiscal 2015.
Potential growth ahead
F5 continues to see its potential growth prospects attached to its security solutions. It is observing a real growth for its security based solutions that are winning new sales for the company. Also, F5 has recently introduced new functionality to its web application firewall and access solutions namely ASM and APM. The company sees a huge growth associated with these solutions in the future due to growing sophistication and complexity of application attack. These innovative solutions will help the customers to safeguard their applications in on-premise data centres and in private and public cloud.
Besides, F5 released BIG-IQ, its new orchestration and management platform that has three modules for cloud bursting, security and device management. The company has also introduced the next generation iControl on Big-IP exploiting its REST. It is expected to support its software-defined data center and cloud-based architectures. Moreover, it has added it’s first-ever 2U2-slot chassis as an entry-level VIPRION product. These smart moves will help the company to enhance growth for its security market in the future.
Expanding its services
In addition, the company is planning to expand its subscription portfolio for its security solutions. It has recently added various incremental subscription products like Secure Web Gateway products, Versafe anti-malware products and anti-subscription service through its Security Operation Centres. It expects its Policy Enforcement module or PEM to gain traction in the market. PEM offers integrated subscriber and application awareness, traffic steering, reporting and policy enforcement.
Moreover, the company has recently acquired Defense.Net that should assist the company in the cloud-based service for safeguarding the data centers from DDoS attack. With this acquisition the company now offers the most comprehensive and hybrid DDoS solution in the market that should drive its growth going forward. The company has recently introduced DDI integration with its APM access solution for VMware Horizon. Its security solutions at present represent growth of approximately 41% over 2013.
F5 is also seeing strong growth potential with its TCP protocol optimization in service providers market. The company has recently released around 300 new features across TMOS Vancouver and Alpine. It is observing significant progress with its software sales comprising software modules running on TMOS and software-only Virtual Edition solutions. Its Good, Better, Best sales strategy is gaining a lot of sales for the company. The company has observed tremendous increase in both software attached rate and in and its Virtual Edition sales.
Apart from these smart moves, the company continues to introduce noteworthy improvements in its key security market, the service provider and in mobility markets. It is also investing in the technologies that should enhance its performance in the cloud and software defined data center architecture. It expects incredible growth associated in its cloud-based market that includes Defense.Net, Versafe and general F5-as-a-service solutions.
Conclusion
F5 looks great with its security market with plenty of growth initiatives that should drive its growth over the long-run and deliver handsome returns to its investors and shareholders. Its earnings are expected to grow at the CAGR of 16.44% for the next five years that indicate incredible growth prospects for the company in the future. Also, its short-term returns are very attractive with the CAGR of 16.80% this year and 13.70% by next year respectively.
