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7 Reasons to Add Check Point (CHKP) Stock to Your Portfolio
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Check Point Software Technologies (CHKP - Free Report) is currently one of the top-performing stocks in the technology sector. The stock’s price rally reflects the company’s robust fundamentals.
Therefore, investors should consider adding the stock to their portfolio to shrug off the prevailing highly volatile market environment and make some gains from its upside potential.
Here’s Why CHKP is an Attractive Pick
Share Price Appreciation: Check Point’s price trend reflects that the stock has had an impressive run on the bourse over the past year. Shares of the company have gained 1.7% compared with the Zacks Computer - IT Services industry’s and the S&P 500’s growth of 10% and 15.7%, respectively.
Check Point Software Technologies Ltd. Price and Consensus
Trading Way Below 52-Week High: CHKP stock currently trades lower than its 52-week high, which indicates room for growth. The stock’s closing price of $126.3 on Jul 3 was 7.1% lower than the 52-week high of $135.93 attained on Apr 12, 2023.
Solid Rank & VGM Score: Check Point currently has a Zacks Rank #2 (Buy) and a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities to investors. Thus, the company appears to be a compelling investment proposition at the moment.
Northward Estimate Revisions: Analysts have raised the estimates for 2023 and 2024 over the past 30 days, reflecting their confidence in the company. During the same period, the Zacks Consensus Estimate for 2023 and 2024 moved north by a penny each.
Positive Earnings Surprise History: CHKP has an impressive earnings surprise history. The company outpaced estimates in each of the trailing four quarters, the average surprise being 3.7%.
Strong Earnings Growth Potential: The Zacks Consensus Estimate for 2023 earnings is pegged at $8.03 per share, suggesting year-over-year growth of approximately 8.5%. The consensus mark for 2024 earnings is pegged at $8.77 per share, indicating a year-over-year increase of 9.3%. Moreover, the long-term expected earnings growth rate for the stock is pegged at 7.3%.
Robust Fundamental Growth Drivers: Check Point is benefiting from growth in security subscriptions, which is aided by strong demand for its advanced solutions, primarily CloudGuard, Harmony, Sandblast Zero-day threat prevention and Infinity solutions. The more CHKP sells subscription-based solutions and services, the more it will be able to generate steady revenues, which will drive the bottom-line performance. Besides, increased demand for network security gateways to support higher capacities are aiding the adoption of the company’s remote access virtual private network solutions.
Per a report by Future Market Insights, the global threat intelligence market will witness a CAGR of 16.9% through 2023 to 2033. Another research firm, Fortune Business Insights recently projected that the global threat intelligence security market will reach $18.11 billion by 2030 from $4.93 billion in 2023, representing a CAGR of 20.4%. Check Point’s rich experience in the security space and continued delivery of mission-critical solutions will help it maintain and grow its market share.
The company’s sustained focus on launching products with enhanced capabilities that adhere to continuously evolving cyber threats is driving the demand for its product and services. In June, Check Point collaborated with TELUS, a Canada-based communications technology company, to launch the TELUS Cloud Security Posture Management service in Canada. The management solution is integrated with CHKP’s artificial intelligence (AI)-powered threat prevention and high-fidelity posture management technology. It will aid organizations in Canada to easily monitor cloud security posture in real-time and detect, remediate and report on vulnerabilities.
In May, Check Point announced the general availability of its industry-leading Next-Generation Cloud Firewall natively integrated with Microsoft Azure Virtual WAN to provide customers with top-notch security. In the same month, the company expanded its Harmony Endpoint protection solution with the incorporation of vulnerability and automated patch management capabilities.
The company launched Infinity Global Services in March. The service encompasses the company’s all security solutions that empower organizations of all sizes to fortify their systems, from cloud to network to endpoint. In February, CHKP introduced Check Point Infinity Spark, a threat prevention solution for small and medium-sized businesses that deliver industry-leading AI security and integrated connectivity.
During first-quarter 2023, the information technology security solutions provider reported revenues of $566 million, which climbed 4% year over year. The upside was driven by double-digit growth in product and subscription revenues. The Zacks Consensus Estimate for Check Point’s second-quarter 2023 revenues is pegged at $588.2 million, indicating year-over-year growth of 3%.
The Zacks Consensus Estimate for Salesforce’s second-quarter fiscal 2024 earnings has been revised northward by a penny to $1.90 per share over the past 30 days. For fiscal 2024, earnings estimates have moved up by 2 cents to $7.44 in the past 30 days.
CRM's earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 15.5%. Shares of the company have gained 22.9% in the past year.
The Zacks Consensus Estimate for NVIDIA’s second-quarter fiscal 2024 earnings has been revised southward from $1.97 to $2.04 per share over the past 30 days. For 2023, earnings estimates have moved up by 2.7% to $7.66 in the past 30 days.
NVDA's earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, missing twice, the average surprise being 0.26%. Shares of the company have soared 183.5% in the past year.
The Zacks Consensus Estimate for Meta Platforms' second-quarter 2023 earnings has been revised downward by 5 cents to $2.82 per share over the past 30 days. For 2023, earnings estimates have moved south from $12.04 to $11.94 in the past 30 days.
META’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, missing twice, the average surprise being 15.5%. Shares of the company have surged 70.1% in the past year.
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7 Reasons to Add Check Point (CHKP) Stock to Your Portfolio
Check Point Software Technologies (CHKP - Free Report) is currently one of the top-performing stocks in the technology sector. The stock’s price rally reflects the company’s robust fundamentals.
Therefore, investors should consider adding the stock to their portfolio to shrug off the prevailing highly volatile market environment and make some gains from its upside potential.
Here’s Why CHKP is an Attractive Pick
Share Price Appreciation: Check Point’s price trend reflects that the stock has had an impressive run on the bourse over the past year. Shares of the company have gained 1.7% compared with the Zacks Computer - IT Services industry’s and the S&P 500’s growth of 10% and 15.7%, respectively.
Check Point Software Technologies Ltd. Price and Consensus
Check Point Software Technologies Ltd. price-consensus-chart | Check Point Software Technologies Ltd. Quote
Trading Way Below 52-Week High: CHKP stock currently trades lower than its 52-week high, which indicates room for growth. The stock’s closing price of $126.3 on Jul 3 was 7.1% lower than the 52-week high of $135.93 attained on Apr 12, 2023.
Solid Rank & VGM Score: Check Point currently has a Zacks Rank #2 (Buy) and a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities to investors. Thus, the company appears to be a compelling investment proposition at the moment.
Northward Estimate Revisions: Analysts have raised the estimates for 2023 and 2024 over the past 30 days, reflecting their confidence in the company. During the same period, the Zacks Consensus Estimate for 2023 and 2024 moved north by a penny each.
Positive Earnings Surprise History: CHKP has an impressive earnings surprise history. The company outpaced estimates in each of the trailing four quarters, the average surprise being 3.7%.
Strong Earnings Growth Potential: The Zacks Consensus Estimate for 2023 earnings is pegged at $8.03 per share, suggesting year-over-year growth of approximately 8.5%. The consensus mark for 2024 earnings is pegged at $8.77 per share, indicating a year-over-year increase of 9.3%. Moreover, the long-term expected earnings growth rate for the stock is pegged at 7.3%.
Robust Fundamental Growth Drivers: Check Point is benefiting from growth in security subscriptions, which is aided by strong demand for its advanced solutions, primarily CloudGuard, Harmony, Sandblast Zero-day threat prevention and Infinity solutions. The more CHKP sells subscription-based solutions and services, the more it will be able to generate steady revenues, which will drive the bottom-line performance. Besides, increased demand for network security gateways to support higher capacities are aiding the adoption of the company’s remote access virtual private network solutions.
Per a report by Future Market Insights, the global threat intelligence market will witness a CAGR of 16.9% through 2023 to 2033. Another research firm, Fortune Business Insights recently projected that the global threat intelligence security market will reach $18.11 billion by 2030 from $4.93 billion in 2023, representing a CAGR of 20.4%. Check Point’s rich experience in the security space and continued delivery of mission-critical solutions will help it maintain and grow its market share.
The company’s sustained focus on launching products with enhanced capabilities that adhere to continuously evolving cyber threats is driving the demand for its product and services. In June, Check Point collaborated with TELUS, a Canada-based communications technology company, to launch the TELUS Cloud Security Posture Management service in Canada. The management solution is integrated with CHKP’s artificial intelligence (AI)-powered threat prevention and high-fidelity posture management technology. It will aid organizations in Canada to easily monitor cloud security posture in real-time and detect, remediate and report on vulnerabilities.
In May, Check Point announced the general availability of its industry-leading Next-Generation Cloud Firewall natively integrated with Microsoft Azure Virtual WAN to provide customers with top-notch security. In the same month, the company expanded its Harmony Endpoint protection solution with the incorporation of vulnerability and automated patch management capabilities.
The company launched Infinity Global Services in March. The service encompasses the company’s all security solutions that empower organizations of all sizes to fortify their systems, from cloud to network to endpoint. In February, CHKP introduced Check Point Infinity Spark, a threat prevention solution for small and medium-sized businesses that deliver industry-leading AI security and integrated connectivity.
During first-quarter 2023, the information technology security solutions provider reported revenues of $566 million, which climbed 4% year over year. The upside was driven by double-digit growth in product and subscription revenues. The Zacks Consensus Estimate for Check Point’s second-quarter 2023 revenues is pegged at $588.2 million, indicating year-over-year growth of 3%.
Other Stocks to Consider
Some other top-ranked stocks from the broader Computer and Technology sector are Salesforce (CRM - Free Report) , NVIDIA Corporation (NVDA - Free Report) and Meta Platforms (META - Free Report) . While Salesforce and NVIDIA sport a Zacks Rank #1, Meta carries a Zacks Rank #2 at present. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Salesforce’s second-quarter fiscal 2024 earnings has been revised northward by a penny to $1.90 per share over the past 30 days. For fiscal 2024, earnings estimates have moved up by 2 cents to $7.44 in the past 30 days.
CRM's earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 15.5%. Shares of the company have gained 22.9% in the past year.
The Zacks Consensus Estimate for NVIDIA’s second-quarter fiscal 2024 earnings has been revised southward from $1.97 to $2.04 per share over the past 30 days. For 2023, earnings estimates have moved up by 2.7% to $7.66 in the past 30 days.
NVDA's earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, missing twice, the average surprise being 0.26%. Shares of the company have soared 183.5% in the past year.
The Zacks Consensus Estimate for Meta Platforms' second-quarter 2023 earnings has been revised downward by 5 cents to $2.82 per share over the past 30 days. For 2023, earnings estimates have moved south from $12.04 to $11.94 in the past 30 days.
META’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, missing twice, the average surprise being 15.5%. Shares of the company have surged 70.1% in the past year.