We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is Check Point (CHKP) Down 0.6% Since Last Earnings Report?
Read MoreHide Full Article
A month has gone by since the last earnings report for Check Point Software (CHKP - Free Report) . Shares have lost about 0.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Check Point due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Check Point Q4 Earnings & Revenues Beat Estimates
Check Point Software Technologies reported fourth-quarter 2020 results, wherein both top and bottom lines beat the Zacks Consensus Estimate. The company’s non-GAAP earnings per share of $2.17 beat the consensus mark of $2.11. The figure also climbed 7% year over year.
Revenues for the reported quarter came in at $564 million, up 4% year on year. Moreover, the figure exceeded the Zacks Consensus Estimate of $555.1 million. Growth in SaaS and IaaS cloud solutions drove the top line. In addition, the work-from-home-related solutions — Mobile Access and Sandblast Agent — continued to witness strong traction.
Quarter Details
Subscription revenues came in at $180 million, increasing 10% year over year, on solid demand for its advanced solutions, primarily CloudGuard, Sandblast Zero-day threat prevention and Infinity solutions. During the fourth quarter, the company secured several Infinity deals in various industries, including government, telecommunication and industrial.
Revenues of $161 million from products and licenses inched up 1.7%. Products are currently in the process of transitioning to cloud solutions, which is included in the subscription line.
Total revenues from product and security subscriptions came in at $340 million, up 6% year on year.
Software update and maintenance revenues increased to $224 million from the $222 million reported in the year-ago quarter.
As of Dec 31, 2021, deferred revenues were $1.48 billion, up 7% year over year, reflecting strength in security subscription.
Region wise, the Americas generated 43% of total revenues; Europe, Middle East and Africa accounted for 45%; and the Asia Pacific contributed 12%.
Non-GAAP operating income for the reported quarter came in at $285 million, up 1.8% year over year. Non-GAAP operating margin remained flat at 51%.
Balance Sheet & Other Financial Details
Check Point exited the fourth quarter with cash and cash equivalents, marketable securities and short-term deposits of $4 billion compared with the previous quarter’s $3.9 billion.
The company generated cash worth $293 million from operational activities during the fourth quarter and $1.15 billion in full-year 2020.
It repurchased 2.7 million shares for about $323 million during the December-end quarter. During full-year 2020, the company bought back 11.4 million shares for $1.3 billion.
Outlook
Check Point has issued the guidance for first-quarter and full-year 2021. For the ongoing quarter, the company projects revenues between $485 million and $515 million (mid-point $500 million). It forecasts adjusted earnings per share in the range of $1.45 to $1.55 (mid-point $1.50).
For full-year 2021, Check Point estimates revenues to be in the range of $2.08-$2.18 billion and adjusted earnings per share between $6.45 and $6.85.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
VGM Scores
Currently, Check Point has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Check Point has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is Check Point (CHKP) Down 0.6% Since Last Earnings Report?
A month has gone by since the last earnings report for Check Point Software (CHKP - Free Report) . Shares have lost about 0.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Check Point due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Check Point Q4 Earnings & Revenues Beat Estimates
Check Point Software Technologies reported fourth-quarter 2020 results, wherein both top and bottom lines beat the Zacks Consensus Estimate. The company’s non-GAAP earnings per share of $2.17 beat the consensus mark of $2.11. The figure also climbed 7% year over year.
Revenues for the reported quarter came in at $564 million, up 4% year on year. Moreover, the figure exceeded the Zacks Consensus Estimate of $555.1 million. Growth in SaaS and IaaS cloud solutions drove the top line. In addition, the work-from-home-related solutions — Mobile Access and Sandblast Agent — continued to witness strong traction.
Quarter Details
Subscription revenues came in at $180 million, increasing 10% year over year, on solid demand for its advanced solutions, primarily CloudGuard, Sandblast Zero-day threat prevention and Infinity solutions. During the fourth quarter, the company secured several Infinity deals in various industries, including government, telecommunication and industrial.
Revenues of $161 million from products and licenses inched up 1.7%. Products are currently in the process of transitioning to cloud solutions, which is included in the subscription line.
Total revenues from product and security subscriptions came in at $340 million, up 6% year on year.
Software update and maintenance revenues increased to $224 million from the $222 million reported in the year-ago quarter.
As of Dec 31, 2021, deferred revenues were $1.48 billion, up 7% year over year, reflecting strength in security subscription.
Region wise, the Americas generated 43% of total revenues; Europe, Middle East and Africa accounted for 45%; and the Asia Pacific contributed 12%.
Non-GAAP operating income for the reported quarter came in at $285 million, up 1.8% year over year. Non-GAAP operating margin remained flat at 51%.
Balance Sheet & Other Financial Details
Check Point exited the fourth quarter with cash and cash equivalents, marketable securities and short-term deposits of $4 billion compared with the previous quarter’s $3.9 billion.
The company generated cash worth $293 million from operational activities during the fourth quarter and $1.15 billion in full-year 2020.
It repurchased 2.7 million shares for about $323 million during the December-end quarter. During full-year 2020, the company bought back 11.4 million shares for $1.3 billion.
Outlook
Check Point has issued the guidance for first-quarter and full-year 2021. For the ongoing quarter, the company projects revenues between $485 million and $515 million (mid-point $500 million). It forecasts adjusted earnings per share in the range of $1.45 to $1.55 (mid-point $1.50).
For full-year 2021, Check Point estimates revenues to be in the range of $2.08-$2.18 billion and adjusted earnings per share between $6.45 and $6.85.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
VGM Scores
Currently, Check Point has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Check Point has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.