Baird has maintained its Outperform rating on CyberArk Software (NASDAQ: NASDAQ:CYBR) and increased the price target to $355 from $315.
The firm anticipates a strong third-quarter earnings report from CyberArk on November 13, 2024, citing easy comparisons from the previous year and positive feedback from sales channels.
The analyst expects CyberArk to exceed its third-quarter and full-year 2024 guidance, which was set conservatively, leaving potential for an upside.
The company has been benefiting from trends in the market such as the consolidation of identity platforms, as well as partnerships with Value-Added Resellers (VARs), Managed Security Service Providers (MSSPs), and Global System Integrators (GSIs).
CyberArk's unified security solutions have been gaining traction, especially as businesses prioritize Privileged Access Management (PAM) and identity management in their budgets. The analyst also highlighted the potential benefits from the company's recent acquisition of Venafi, which is expected to contribute positively to the fourth quarter of 2024 and the full year of 2025.
In other recent news, CyberArk Software has been the focus of positive attention from several financial firms. Oppenheimer has upgraded its stock target for CyberArk, citing expected surpassing of third-quarter revenue guidance set between $230 million and $236 million.
The firm also acknowledged a strong demand for CyberArk's Workforce Access and Secrets Management products. Scotiabank initiated coverage on CyberArk with a Sector Outperform rating and a price target of $340, while Baird maintained its Outperform rating with a price target of $315.
RBC Capital, DA Davidson, and Canaccord Genuity have also initiated or maintained positive ratings for the company, with price targets ranging from $310 to $328.
These recent developments come on the heels of CyberArk's impressive second quarter 2024 earnings report, which showed a 28% growth in total revenue, reaching $224.7 million, and a 50% expansion in Annual Recurring Revenue (ARR), contributing to a total ARR of $868 million. The company's acquisition of Venafi is also expected to contribute positively to its future performance.
InvestingPro Insights
CyberArk Software's strong market position, as highlighted in Baird's analysis, is further supported by data from InvestingPro. The company's revenue growth of 30.52% over the last twelve months aligns with the analyst's expectations of a strong third-quarter earnings report. This growth trajectory is particularly impressive given CyberArk's already substantial market capitalization of $12.49 billion.
InvestingPro Tips reveal that CyberArk holds more cash than debt on its balance sheet, which provides financial flexibility to support its growth initiatives and potential future acquisitions like Venafi. Additionally, the company boasts impressive gross profit margins, reported at 80.62% for the last twelve months, indicating strong pricing power and efficient operations in the competitive cybersecurity market.
While the company is not currently profitable over the last twelve months, with an operating income margin of -6.82%, InvestingPro Tips suggest that analysts predict CyberArk will be profitable this year. This aligns with Baird's optimistic outlook and the expectation of exceeding guidance.
Investors should note that CyberArk is trading near its 52-week high, with a high return of 72.86% over the last year. This performance reflects the market's confidence in the company's strategic positioning and growth prospects in the identity and access management space.
For those interested in a deeper dive into CyberArk's financials and future prospects, InvestingPro offers 12 additional tips, providing a comprehensive view of the company's investment potential.
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