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CyberArk Rides on Add-On Businesses, Competition a Drag
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On Aug 13, we issued an updated research report on Israel-based CyberArk Software Ltd. (CYBR - Free Report) .
The company offers services, which protect organizational privileged accounts from cyber-attacks. The company is on a growth trajectory, gathering momentum from its positive earnings surprise history and strong fundamentals.
Notably, CyberArk has beaten the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average positive surprise of 38.79%.
The company reported strong second-quarter 2018 results. The top line and bottom line surpassed the respective Zacks Consensus Estimate and improved significantly year over year. Management also provided optimistic guidance for the third quarter.
We believe that the impressive results and the guidance will help sustain the stock’s momentum. Notably, shares of CyberArk have gained 71% year to date, outperforming the industry’s rally of 33.5%.
Fundamentals Driving Growth
CyberArk is gaining traction from high level of customer satisfaction and growing adoption of its solutions. As a result, the company is winning deals in new as well as add-on business. Notably, add-on business accounted for 55% of license revenues in the second quarter.
CyberArk is also continuing to benefit from its partnerships and acquisitions. Its buyout of Vaultive in March this year looks promising. The acquisition of Conjur in May last year continues to be accretive to its revenues. The company is also gaining momentum among advisory firms like Deloitte, PWC, KPMG and Accenture.
The market for cyber security is expected to witness a CAGR of 9.8% to reach about $170 billion by the end of this decade. CyberArk is growing rapidly in this space on the back of its privileged access management solutions which offers customers a set of products that help them to secure, manage and monitor privileged account access and activities.
However, near-term prospects for CyberArk are not promising as changing customer spending behavior has recently hit several other players in this space.
Moreover, the company faces competition from numerous big and small companies in the security application market. Further, over the past few years, the demand for IT security has grown, driven by increasing cyber-attacks, making the market more attractive for new players. This remains a major concern for the company.
Long-term earnings growth for Paycom, Qualys and Fortinet is projected to be 24.82%, 8% and 16.75%, respectively.
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It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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CyberArk Rides on Add-On Businesses, Competition a Drag
On Aug 13, we issued an updated research report on Israel-based CyberArk Software Ltd. (CYBR - Free Report) .
The company offers services, which protect organizational privileged accounts from cyber-attacks. The company is on a growth trajectory, gathering momentum from its positive earnings surprise history and strong fundamentals.
Notably, CyberArk has beaten the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average positive surprise of 38.79%.
The company reported strong second-quarter 2018 results. The top line and bottom line surpassed the respective Zacks Consensus Estimate and improved significantly year over year. Management also provided optimistic guidance for the third quarter.
We believe that the impressive results and the guidance will help sustain the stock’s momentum. Notably, shares of CyberArk have gained 71% year to date, outperforming the industry’s rally of 33.5%.
Fundamentals Driving Growth
CyberArk is gaining traction from high level of customer satisfaction and growing adoption of its solutions. As a result, the company is winning deals in new as well as add-on business. Notably, add-on business accounted for 55% of license revenues in the second quarter.
CyberArk is also continuing to benefit from its partnerships and acquisitions. Its buyout of Vaultive in March this year looks promising. The acquisition of Conjur in May last year continues to be accretive to its revenues. The company is also gaining momentum among advisory firms like Deloitte, PWC, KPMG and Accenture.
The market for cyber security is expected to witness a CAGR of 9.8% to reach about $170 billion by the end of this decade. CyberArk is growing rapidly in this space on the back of its privileged access management solutions which offers customers a set of products that help them to secure, manage and monitor privileged account access and activities.
However, near-term prospects for CyberArk are not promising as changing customer spending behavior has recently hit several other players in this space.
Moreover, the company faces competition from numerous big and small companies in the security application market. Further, over the past few years, the demand for IT security has grown, driven by increasing cyber-attacks, making the market more attractive for new players. This remains a major concern for the company.
Zacks Rank & Stocks to Consider
CyberArk currently carries Zacks Rank #3 (Hold).
A few better-ranked stocks in the broader Computer and Technology sector are Paycom Software, Inc. (PAYC - Free Report) , Qualys, Inc. (QLYS - Free Report) and Fortinet, Inc. (FTNT - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth for Paycom, Qualys and Fortinet is projected to be 24.82%, 8% and 16.75%, respectively.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>