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CyberArk Software Ltd (CYBR) Triggers Mixed Analyst Reviews Following Q2 Earnings

By Carly Forster

Cyber security company CyberArk Software Ltd (NASDAQ:CYBR) posted second quarter 2015 earnings results on August 12, triggering mixed reviews from Wall Street analysts.

The company posted impressive results overall, beating earnings expectations and raising its full fiscal year guidance. Earnings per share came in at $0.19 versus the analyst consensus of $0.06. Total revenue came in at $36.4 million, marking a 70% increase year-over-year. CyberArk also raised its full fiscal year guidance from a range of $136 million-$136 million to a range of $145 million-$147 million, which was above the Street’s consensus of $140.5 million.

CyberArk CEO Udi Mokady said of the earnings beat, “CyberArk had a strong second quarter and delivered results that again exceeded our guidance across all financial metrics. Our business continues to be driven by the shift from tactical, compliance-driven projects to strategic approaches to implementing enterprise-wide privileged account security as privileged accounts remain at the epicenter of cyber attacks. This shift is enabling us to capitalize on expanding cyber security budgets, participate in larger opportunities, and position ourselves as a strategic, trusted partner.”

Oppenheimer analyst Shaul Eyal was impressed by CyberArk’s Q2 earnings results, reiterating an Outperform rating on the stock with a $70 price target on August 12. The analyst cites that the company benefited from several factors, including “an acceleration of spending on security products, its ability to convince its customers to buy more of its products, and its ability to attract new customers.” Additionally, Eyal believes, “Customers are more attracted to CyberArk’s integrated products than the ‘point solution approach’ of its competitors.” Overall, Eyal believes, “Interest in Privileged Account Management solutions are increasing, while CyberArk’s momentum is strong.”

On average, Shaul Eyal has a 74% success rate recommending stocks and a +19.2% average return per recommendation when measured over a one-year horizon and no benchmark. The analyst has rated CyberArk 7 times since 2010, earning a 57% success rate recommending the stock and a +21.3% average return per recommendation.

On the other hand, JP Morgan analyst Sterling Auty reiterated an Underweight rating on CyberArk with a $48 price target on August 12, citing the company’s decelerating growth. The analyst noted, “the amount by which CyberArk’s revenue has surpassed the consensus outlook has dropped for the last three quarters.” Auty predicts that “Eventually the company’s revenue will probably only beat expectations by 1%-5%.” The analyst concluded, “Although nothing is “structurally wrong” with CyberArk, its current valuation is excessive, given its growth potential beyond 2015.”

Overall, Sterling Auty has a 58% success rate recommending stocks and a +5.9% average return per recommendation when measured over a one-year horizon and no benchmark. The analyst has rated CyberArk 3 times this year, earning a 67% success rate recommending the stock and a +4.4% average return per recommendation.

Out of 31 analysts polled by TipRanks within the past 3 months, 27 analysts are bullish on CyberArk and 4 analysts are neutral. The average 12-month price target for CyberArk is $764, marking a 10.49% potential upside from where the stock last closed. On average, the all-analyst consensus on CyberArk is Strong Buy.

Carly Forster writes about stock marke