Goldman Sachs has cut its price target for Nutanix (NASDAQ:NTNX) to $60 from $75, while maintaining a Buy rating on the enterprise software company. The firm cited a sector-wide de-rating in software as a key driver of the adjustment and said it has incorporated an M&A multiple into its valuation framework.
At present, InvestingPro data shows Nutanix shares changing hands at $40.26, which is roughly 52% below the stock's 52-week high of $83.36. Goldman Sachs said the lower target reflects the altered multiple environment for software stocks even as it remains constructive on Nutanix's underlying prospects.
The research team highlighted the possibility of short-term volatility around Nutanix's fiscal second-quarter results, which are scheduled for February 25. Goldman noted that much of the share-price underperformance - the stock is down about 32% since the company's first-quarter report - appears to reflect a guidance reset that the bank views as related to timing. InvestingPro's six-month performance metric is even more severe, displaying a 43.77% decline.
Goldman Sachs expects Nutanix to report fiscal second-quarter results in-line with, or slightly above, consensus estimates. Looking through the near-term noise, the firm pointed to a valuation consistent with roughly 10x EV/FCF on a fiscal 2027 basis, and said the market is effectively discounting Nutanix's capacity to sustain low double-digit growth. Supporting that view, InvestingPro shows a PEG ratio of 0.14, which Goldman interprets as an indicator that the stock may be undervalued relative to expected earnings growth.
While Goldman acknowledged potential continued price swings in the near term, it said healthy free cash flow generation should provide a downside cushion and that a more attractive risk-reward dynamic may emerge over a 12-month horizon. InvestingPro's Fair Value assessment also suggests room for upside at current levels, and the platform offers additional analysis for investors seeking deeper financial insight.
The move by Goldman comes amid a broader recalibration among sell-side analysts following Nutanix's own recent disclosures. The company reported a first-quarter revenue miss and trimmed its fiscal 2026 top-line outlook, prompting several firms to revisit their models and targets. Morgan Stanley lowered its price target to $82 and maintained an Overweight stance, describing the issue as related to timing in revenue recognition. Needham cut its target to $65 while keeping a Buy rating, citing a larger-than-expected mix of orders with future start dates. Barclays downgraded its recommendation from Overweight to Equalweight, expressing concern about slower gains in market share versus VMWare.
Separately, Nutanix announced a $300 million accelerated share repurchase agreement with Bank of America that it plans to fund from existing cash resources. Once that program completes, the company expects it will have repurchased approximately $382.5 million of common stock since the beginning of fiscal 2026.
Nutanix also expanded its senior commercial leadership, appointing Tarkan Maner as president and chief commercial officer with responsibilities that now span sales, marketing, and customer experience. The company confirmed that Maner's compensation remains unchanged and that there are no related-party transactions or family relationships connected to the appointment.
Goldman Sachs' adjustment illustrates how shifts in sector multiples can alter price targets even when analysts retain a positive stance on a company's fundamentals. The bank's view balances short-term risks tied to quarterly results and guidance timing against a longer-term perspective that emphasizes free cash flow and valuation measures.