By Sam Boughedda
In a note focused on hybrid IT stocks, a Morgan Stanley analyst said they prefer names such as Nutanix (NASDAQ:NTNX), Pure Storage, Inc. (NYSE:PSTG), F5 Networks (NASDAQ:FFIV), and Palo Alto Networks (NASDAQ:PANW).
"Enterprises are heading toward a hybrid IT future, leveraging multiple public clouds and on-premise or colocated footprint," said the analyst.
"Hybrid increasingly is IT's end state, creating a role for legacy infrastructure vendors that adapt. While the growth of public cloud workloads is often the headline within technology today, according to IDC, ~95% of enterprises expect to utilize a combination of on-premise / colocated / public cloud workloads, otherwise known as 'hybrid IT,'" he added.
Morgan Stanley believes there are several traditional infrastructure vendors with compelling hybrid IT offerings, and they expect traditional hardware vendors to continue to develop offerings or pursue inorganic opportunities to take advantage of opportunities.
"We prefer NTNX, PSTG, PANW, and FFIV as vendors better positioned to hybrid models, where revenue stream from cloud are not as corrosive to premise opportunity," concluded the analyst.