It's also worth noting that SWI is set to issue its 3Q18 results after the close tonight, its first earnings report since going public on October 19. So, investors may also be positioning themselves in anticipation of a solid, upside report from the company tonight.
On that note, SWI's gross margin has been steadily improving, while it has doing a very good job managing costs. Along with the 17% top-line growth for the six months ended June 30, 2018, SWI's operating income surged by 217% to $44.1 mln. Although its top-line growth isn't spectacular, the company is well-run, and, already had a run in the public markets before being taken private in 2016. Therefore, it should be in good shape for managing outlook expectations.
Quiet Period Expiration Review & Conclusion
Given the size and prominence of SWI, there are quite a few analysts picking up coverage on the name. As we alluded to above, a majority of them landed on the bullish side. The headliner that is likely catching the most attention is Goldman Sachs' Buy rating and $23 price target, representing an upside of 56% from yesterday's close. For a tier one firm, such as Goldman Sachs, to take such an aggressively bullish stance on a stock is especially compelling, particularly just ahead of earnings.
A few other notable bullish initiations include JP Morgan's Overweight and $20 price target, and Credit Suisse, RBC Capital, and Evercore ISI each assigning Outperforms on the stock, with price targets of $19, $18, and $18, respectively.
On the more cautious side, Barclays went with an Equal Weight and $16 price target. Morgan Stanley also put an Equal Weight on the stock, but, it has a price target of $18, which still pencils out to 22% upside from current prices.
It has been a rocky start for SWI, with the volatile broader markets not helping its cause. However, with a pair of potential catalysts lined up today in its quiet period expiration and earnings report, the stock may be poised to make a run to new post-IPO highs should its Q3 results and guidance come in better than expected tonight.