Credit Suisse analyst Kulbinder Garcha is out with a new research note on shares of Nutanix Inc (NASDAQ:NTNX), after attending the company’s .NEXT 2017 conference as well as its analyst day in D.C.

At the conference, Nutanix previewed its Xi Cloud Services and Calm cloud orchestration software. In addition, Nutanix announced a strategic alliance with Google Cloud to collaborate on an expanding Internet of Things (IoT) and to merge the companies’ cloud environments for enterprise applications.

Garcha commented, “The company announced a series of new features to its Enterprise Cloud OS, such as Calm and Xi, along with a new partnership with Google Cloud, which we believe will further its roadmap to make Cloud invisible. At the analyst meeting, management highlighted that NTNX is essentially a software company with 75-80% of the value coming from software. NTNX now distributes its software in several ways: OEM partnership with Dell and Lenovo, Meet-in-Channel with Cisco and HPE with transferable entitlement, sales of Pro and Ultimate tiers software, and increasing ELAs content. Management also noted that Calm and Xi could be the new avenues to generate revenues. We increasingly believe that our above-consensus revenue estimates of $762mn/$1.2bn (+71%/52% yoy) could prove conservative and that NTNX’s GM will recover above our estimate of 59% over time.”

As such, Garcha reiterates an Outperform rating on shares of Nutanix, with a price target of $38, which represents a potential upside of 86% from where the stock is currently trading. (Watch the analyst’s track record here.)

Out of the 16 analysts polled by TipRanks (in the past 3 months), 11 are bullish on Nutanix stock, 4 are neutral, while only one remains bearish on the stock. With a return potential of 43.53%, the stock’s consensus target price stands at $29.08.