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CyberArk Is Pivoting


Growth looks to be plateauing at CyberArk, but guidance continues to be revised upward.

What no one has mentioned is the company has used this year thus far to reinvest in itself.

This reinvestment will keep CyberArk at the forefront of their market and they will be able to extend their growth beyond what most expect.

With another quarter on record for CyberArk (NASDAQ:CYBR), I dove in to see what - if anything - needed further analysis other than the upfront earnings numbers. Only two things stood out to me: guidance has continued to climb and the company has chosen to invest heavily in itself.

Point number one has been a hot topic with CyberArk in recent quarters. As has been pointed out by my readers and fellow contributors alike, management likes to play it conservative even if it means formulating substantial slowing in growth or an all-out negative growth story. Take this quarter for example.

Guidance for Q3 on net income is set at $0.21-0.23 per share. This compares to $0.26 per share in income for the third quarter of last year. On its face it says a 15% decrease in earnings year-over-year is expected.

Now, as I've written about before, management has a track record of guiding light and blowing past expectations. Recently, Stone Fox Capital succinctly made light of this with the recent report also. I think it's safe to say we both agree the company will exceed expectations and will not return a negative growth story.

The key point I want to take away from guidance is yearly guidance continues to be revised upward. In Q4 of last year the company announced yearly guidance for '16 with net income coming in at $0.83 to $0.86 per share. Again, those numbers would have shown a remarkable...