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What You Missed Out by Overlooking CyberArk (CYBR) Stock
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Shares of CyberArk Software Ltd. (CYBR - Free Report) have been gaining solid momentum, of late, and even crafted a fresh 52-week high of $59.77, yesterday. The company’s better-than-expected first-quarter 2018 results, which improved year over year as well, are one of the most likely reasons for the upsurge in the company’s share price. Also, an encouraging second-quarter and full-year 2018 outlook drove shares higher.
Notably, the company has gained more than 8% since it reported first-quarter results, on May 3. The stock has outperformed the industry to which it belongs to in the year-to-date period. CyberArk has appreciated 43.8%, while the industry has gained 24.1% during the time frame.
CyberArk’s first-quarter revenues were up 22% year over year to $71.8 million and came ahead of management’s guided range of $68.25-$69.75 million (mid-point $69 million), as well as beat the Zacks Consensus Estimate of $69 million. The company’s top line mainly benefited from better sales execution, customer acquisitions and add-on business from existing clients.
Cybersecurity solution provider reported non-GAAP earnings of 32 cents, up 14.3% from the year-ago quarter, chiefly backed by higher revenues which were partially offset by elevated operating expenses. Moreover, quarterly earnings came ahead of management’s guided range of 19-22 cents, and surpassed the Zacks Consensus Estimate of 21 cents as well.
In fact, CyberArk has beaten the Zacks Consensus Estimate in each of the last four quarters, with an average positive earnings surprise of 27.5%. Backed by the stellar results, the company has issued an encouraging outlook for both the second quarter and the full year.
Let’s take a look at what factors are driving CyberArk’s back-to-back impressive quarterly performances.
Elevated Cyber Security Demand Driving Revenues
The company has been benefiting from the surge in demand for cyber security following the cyber attacks that jolted the world last year.
The slew of data breaches has brought to light the fact that a company’s financial well-being, brands and reputation are today increasingly exposed to cyber threats. The rapid emergence of cloud computing and the concept of sharing resources to lower costs have spurred demand for adequate security policies, protocols and products.
Per a recent report by MarketsandMarkets, the cyber security market is expected to witness a CAGR of 11% from $137.85 billion in 2017 to $231.94 billion by 2022. We believe CyberArk, with its portfolio of cyber security products, is well poised to enjoy the growth prospects.
Expanding Through Acquisitions
CyberArk’s expansion strategy through acquisitions is encouraging for the near term. Per the company, last year’s acquisition of Conjur business has received positive customer response. Conjur specializes in offering DevOps security software. Therefore, the acquisition is anticipated to boost CyberArk’s capabilities in empowering companies to accelerate software deployment in their organizations with more security.
The company’s other most notable acquisitions in the last few years include the buyout of certain assets of Agata Ltd. in 2016, and the takeover of Cybertinel and Viewfinity companies in 2015. We believe these deals have not only helped expand the company’s capabilities but its customer base as well.
Sales Strategies Bringing in New Customers
CyberArk’s strategy of enhancing relationship with channel partners is bringing in new customers. The company noted that channel partners make a key component for its go-to-market sales strategy and generated roughly 60% of the business in the first quarter.
This apart, the company’s C3 technology alliance program is also influencing deals, in turn, bolstering its revenues. CyberArk has nearly 70 partners, now, under this program, which includes companies like Proofpoint , Qualys (QLYS - Free Report) and ServiceNow (NOW - Free Report) .
We believe the company’s continued focus on the aforementioned initiatives will continue to drive its top-line performance.
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Image: Bigstock
What You Missed Out by Overlooking CyberArk (CYBR) Stock
Shares of CyberArk Software Ltd. (CYBR - Free Report) have been gaining solid momentum, of late, and even crafted a fresh 52-week high of $59.77, yesterday. The company’s better-than-expected first-quarter 2018 results, which improved year over year as well, are one of the most likely reasons for the upsurge in the company’s share price. Also, an encouraging second-quarter and full-year 2018 outlook drove shares higher.
Notably, the company has gained more than 8% since it reported first-quarter results, on May 3. The stock has outperformed the industry to which it belongs to in the year-to-date period. CyberArk has appreciated 43.8%, while the industry has gained 24.1% during the time frame.
CyberArk’s first-quarter revenues were up 22% year over year to $71.8 million and came ahead of management’s guided range of $68.25-$69.75 million (mid-point $69 million), as well as beat the Zacks Consensus Estimate of $69 million. The company’s top line mainly benefited from better sales execution, customer acquisitions and add-on business from existing clients.
Cybersecurity solution provider reported non-GAAP earnings of 32 cents, up 14.3% from the year-ago quarter, chiefly backed by higher revenues which were partially offset by elevated operating expenses. Moreover, quarterly earnings came ahead of management’s guided range of 19-22 cents, and surpassed the Zacks Consensus Estimate of 21 cents as well.
In fact, CyberArk has beaten the Zacks Consensus Estimate in each of the last four quarters, with an average positive earnings surprise of 27.5%. Backed by the stellar results, the company has issued an encouraging outlook for both the second quarter and the full year.
Let’s take a look at what factors are driving CyberArk’s back-to-back impressive quarterly performances.
Elevated Cyber Security Demand Driving Revenues
The company has been benefiting from the surge in demand for cyber security following the cyber attacks that jolted the world last year.
The slew of data breaches has brought to light the fact that a company’s financial well-being, brands and reputation are today increasingly exposed to cyber threats. The rapid emergence of cloud computing and the concept of sharing resources to lower costs have spurred demand for adequate security policies, protocols and products.
Per a recent report by MarketsandMarkets, the cyber security market is expected to witness a CAGR of 11% from $137.85 billion in 2017 to $231.94 billion by 2022. We believe CyberArk, with its portfolio of cyber security products, is well poised to enjoy the growth prospects.
Expanding Through Acquisitions
CyberArk’s expansion strategy through acquisitions is encouraging for the near term. Per the company, last year’s acquisition of Conjur business has received positive customer response. Conjur specializes in offering DevOps security software. Therefore, the acquisition is anticipated to boost CyberArk’s capabilities in empowering companies to accelerate software deployment in their organizations with more security.
The company’s other most notable acquisitions in the last few years include the buyout of certain assets of Agata Ltd. in 2016, and the takeover of Cybertinel and Viewfinity companies in 2015. We believe these deals have not only helped expand the company’s capabilities but its customer base as well.
Sales Strategies Bringing in New Customers
CyberArk’s strategy of enhancing relationship with channel partners is bringing in new customers. The company noted that channel partners make a key component for its go-to-market sales strategy and generated roughly 60% of the business in the first quarter.
This apart, the company’s C3 technology alliance program is also influencing deals, in turn, bolstering its revenues. CyberArk has nearly 70 partners, now, under this program, which includes companies like Proofpoint , Qualys (QLYS - Free Report) and ServiceNow (NOW - Free Report) .
We believe the company’s continued focus on the aforementioned initiatives will continue to drive its top-line performance.
CyberArk carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>