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Google to Boost Data Storage Offerings With Elastifile Buyout

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In a bid to further bolster presence in the booming cloud space, Alphabet’s (GOOGL - Free Report) division Google has entered into a definitive agreement to acquire a cloud storage startup, Elastifile. The terms of the deal have not been disclosed yet.

This acquisition is expected to be completed later this year, subject to regulatory approval and other customary closing conditions. Post the completion of the acquisition, Elastifile team will join Google Cloud.

Founded in 2014, Elastifile helps large organizations to store and manage data using services that include Google Cloud platform, Microsoft’s (MSFT - Free Report) Azure and Amazon’s (AMZN - Free Report) AWS. Its software-defined approach to managed Network Attached Storage (NAS) allows businesses to perform compute-intensive workloads with ease.

With the latest offering, Google aims at assisting enterprises in managing their business in an organized manner across hybrid multiple cloud platforms.

This acquisition will definitely boost Google’s footprint in the cloud-storage market with file storage solutions. We believe that the move is likely to help Google in gaining further momentum among cloud customers.

Alphabet Inc. Price and Consensus

 

Alphabet Inc. Price and Consensus

Alphabet Inc. price-consensus-chart | Alphabet Inc. Quote

Cloud Storage Space Holds Promise

Increasing business data is resulting in massive requirement for hybrid storage cloud strategy. The adoption of multi-cloud model to achieve better scalability and attain improved resource utilization is becoming mainstream.

With Elastifile, Google Cloud aims at providing storage transparency to enterprises and thereby accelerating their digital transformation.

Per a report from Research and Markets, the global cloud storage market is expected to reach $207.05 billion by 2026 at a CAGR of 21.9% between 2017 and 2026.

Further, according to another report, the said market is expected to generate revenues of $100.8 billion by 2023 at a CAGR of 22% between 2018 and 2023.

Google is well poised to reap benefits from these booming markets, upon completion of the Elastifile acquisition.

Intensifying Cloud Competition

Increasing growth opportunities in the enterprise cloud storage market are alluring enough to attract other cloud players.

Per a report from Canalys, Google Cloud ranks third in the cloud space, behind Amazon’s AWS and Microsoft’s Azure.

However, Google has been making strong efforts to expand the cloud portfolio and boost profitability.

In this regard, last month, Google entered into a definitive agreement to acquire Looker, a provider of data platform, for $2.6 billion. Notably, Looker’s platform offers business intelligence, data applications and embedded analytics. The integration of these advanced data analytics solutions into the Google Cloud platform will enhance analytics offerings in the cloud space.

Recently, Google Cloud launched Anthos, which is a hybrid cloud product. The company is leveraging the open-source container orchestration system, Kubernetes and on-premise data centers to enable Anthos to aid in the management of hybrid cloud or multiple cloud deployments in case of running managed container services.

We believe thatcloud acquisitions, innovative solutions portfolio of Elastifile and strengthening storage offerings are likely to fortify Google’s competitive position against other cloud players.

Zacks Rank & Key Pick

Alphabet currently carries a Zacks Rank #4 (Sell). A better-ranked stock in the broader technology sector is Dropbox, Inc. (DBX - Free Report) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term projected earnings growth rate for Dropboxis 14.2%.

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