Nutanix (NTNX) is back in focus after reporting third quarter results and issuing revenue guidance for the fourth quarter and full year of 2026, giving investors fresh data to assess the stock.

The share price has climbed 16.61% over the past month and 35.01% over the past 90 days, yet the 1 year total shareholder return is still down 30.44%. This means recent momentum follows a weaker longer term picture at the current price of US$53.64.

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With Nutanix guiding full year 2026 revenue to roughly US$2.82b to US$2.84b and the stock trading at US$53.64, the key question is whether this growth story is still mispriced or if the market is already paying up for future gains.

Most Popular Narrative: 41% Undervalued

With Nutanix’s fair value in the most followed narrative sitting at $90.95 against a last close of $53.64, the narrative views a wide gap between price and expectations.

High margin software economics, shown by an 88% non GAAP gross margin and a 26% free cash flow margin in Q1, combined with a subscription model where revenue may shift but expected lifetime recognition on FY26 bookings is unchanged, can support net income and earnings growth as more of the existing ARR base converts into recognized revenue.

Want to see what kind of earnings curve and margin expansion sit behind that valuation gap These assumptions lean on faster growth, richer profitability, and a re rated earnings multiple driving that $90.95 figure.

Result: Fair Value of $90.95 (UNDERVALUED)

However, this bullish setup still hinges on VMware migrations arriving on time, and on OEM partners avoiding hardware delays that could push out Nutanix’s software revenue.

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Another Angle On Valuation

There is a twist when looking at Nutanix through its P/E. The stock trades on 52.6x earnings, compared with 50.2x for peers and 28.2x for the wider US Software industry, while the fair ratio sits at 37.7x. That premium suggests investors are already paying up, so how comfortable are you with that gap?

Next Steps

With mixed sentiment around valuation and growth, it can be useful to look at the numbers yourself and decide where you stand. To move quickly from headline impressions to a more rounded view, weigh up the balance of risks and upsides in Nutanix’s story by checking the 3 key rewards and 3 important warning signs.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.