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Proofpoint (PFPT) to Report Q2 Earnings: What's in Store?
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Proofpoint Inc. is set to report second-quarter 2018 results on Jul 26.
The company beat the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average positive surprise of 48.82%.
In the last reported quarter, the company reported non-GAAP earnings of 30 cents, which increased 36% year over year and outpaced the Zacks Consensus Estimate of 16 cents.
Moreover, revenues of $162.5 million increased 40.5% year over year and surpassed the Zacks Consensus Estimate of $152 million.
Let’s see how things are shaping up for the upcoming announcement.
Factors at Play
Proofpoint, a leading security-as-a-service provider, has been witnessing remarkable top-line growth on the back of consistent focus on launching products, acquisitions and partnerships. Customer additions, improved add-on-sales and strong renewal rate are key growth drivers for the company.
Proofpoint continues to benefit from increasing demand for cyber-security solutions. For the last few quarters, Proofpoint has been witnessing solid demand for its cyber-security suites from enterprises, which are transitioning to cloud, particularly to Microsoft's (MSFT) Office 365.
Notably, the Zacks Consensus Estimate for revenues for the Protection and Advanced Threat segment is pegged at $129 million, which reflects a year-over-year jump of 43.3%.
Proofpoint has been witnessing tremendous customer growth for its subscription-based services. We believe that continued focus on subscription-based products and services and product upgrades will boost its top line. The Zacks Consensus Estimate for revenues for the segment is pegged at $166 million, indicating a 39.4% increase from the year-ago quarter.
However, Proofpoint incurs heavy investment to enhance its sales and marketing capabilities, particularly by expanding the company’s sales force to survive in the highly competitive cyber-security market. The company’s escalating operating expenses are anticipated to remain an overhang on its bottom line.
What Our Model Says
According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. Zacks Rank #4 (Sell) or #5 (Strong Sell) stocks are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Proofpoint has an Earnings ESP of +1.85% but carries a Zacks Rank #4.
Stocks to Consider
Here are some stocks that you may consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:
CyberArk Software Ltd. (CYBR - Free Report) with an Earnings ESP of +3.38% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
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Proofpoint (PFPT) to Report Q2 Earnings: What's in Store?
Proofpoint Inc. is set to report second-quarter 2018 results on Jul 26.
The company beat the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average positive surprise of 48.82%.
In the last reported quarter, the company reported non-GAAP earnings of 30 cents, which increased 36% year over year and outpaced the Zacks Consensus Estimate of 16 cents.
Moreover, revenues of $162.5 million increased 40.5% year over year and surpassed the Zacks Consensus Estimate of $152 million.
Proofpoint, Inc. Price and EPS Surprise
Proofpoint, Inc. Price and EPS Surprise | Proofpoint, Inc. Quote
Let’s see how things are shaping up for the upcoming announcement.
Factors at Play
Proofpoint, a leading security-as-a-service provider, has been witnessing remarkable top-line growth on the back of consistent focus on launching products, acquisitions and partnerships. Customer additions, improved add-on-sales and strong renewal rate are key growth drivers for the company.
Proofpoint continues to benefit from increasing demand for cyber-security solutions. For the last few quarters, Proofpoint has been witnessing solid demand for its cyber-security suites from enterprises, which are transitioning to cloud, particularly to Microsoft's (MSFT) Office 365.
Notably, the Zacks Consensus Estimate for revenues for the Protection and Advanced Threat segment is pegged at $129 million, which reflects a year-over-year jump of 43.3%.
Proofpoint has been witnessing tremendous customer growth for its subscription-based services. We believe that continued focus on subscription-based products and services and product upgrades will boost its top line. The Zacks Consensus Estimate for revenues for the segment is pegged at $166 million, indicating a 39.4% increase from the year-ago quarter.
However, Proofpoint incurs heavy investment to enhance its sales and marketing capabilities, particularly by expanding the company’s sales force to survive in the highly competitive cyber-security market. The company’s escalating operating expenses are anticipated to remain an overhang on its bottom line.
What Our Model Says
According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. Zacks Rank #4 (Sell) or #5 (Strong Sell) stocks are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Proofpoint has an Earnings ESP of +1.85% but carries a Zacks Rank #4.
Stocks to Consider
Here are some stocks that you may consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:
Castlight Health (CSLT - Free Report) with an Earnings ESP of +11.11%, and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
CyberArk Software Ltd. (CYBR - Free Report) with an Earnings ESP of +3.38% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>