CyberArk stock recently hit a new all-time high of $241.36. In 2023, the stock price rose 69%. (photograph … [+]
The majority of recent cybersecurity incidents involve identity theft; cyber ark (CYBR), a provider of identity security platforms centered around intelligent privilege control, appears well-positioned for continued solid growth.
CyberArk has over 8,000 customers, including over 55% of Fortune 500 companies. The company’s platform allows any type of identity (including machines) to securely access any resource or environment from any device. The average analyst estimate for 2024 is for CyberArk’s total revenue to increase 24% to $916.2 million, with the highest estimate of $942.8 million representing 27.6% growth.
CyberArk is the clear leader in privileged access management (PAM), protecting privileged credentials and secrets both on-premises and in the cloud. The company primarily serves large enterprises as well as the upper middle market segment (organizations with annual revenues of at least $500 million). Rising threats, continued migration to the cloud, and exponential growth in identities are all driving demand for the company’s products.
Identity security requires appropriate levels of privilege control. Organizations struggle with how to assign privileges and provision access to provide each identity with the right level of security at the right time. CyberArk is the only vendor that can offer customers an identity security platform that gives them the flexibility to provide permanent access, just-in-time access, or zero permanent access privileges, depending on the identity type and the specific targets they need access to. .
A number of recent high-profile identity-related breaches (including those at Caesars and MGM Resorts) have put identity security in the spotlight. Operating in a $50 billion market, Cyber ​​Ark provides investors with exposure to one of the highest priority spending areas in cybersecurity. So it’s no surprise that CyberArk stock hit an all-time high of $241.36 this month. In 2023, the stock price rose 69%. Shares have recently been trading around $236, up 7% year-to-date.
In the third quarter, CyberArk reported total revenue of $191.2 million (3.5% above consensus estimates), with growth accelerating to 25% from 24% in the June quarter. Recurring revenue increased 36% to $174.4 million (91% of total revenue), accelerating from 31% growth in the second quarter. Total annual recurring revenue (ARR) was $705 million, up 38%, and the subscription portion of $504 million (72% of total ARR) led to an impressive 68% growth.
In the third-quarter earnings call, CyberArk CEO Matt Cohen said the company “experienced a stronger macro environment compared to the past several quarters.” Reservation growth exceeded expectations, and closing rates improved significantly. Cohen said it was another strong quarter this year in terms of pipeline builds, but conversion rates within the pipeline continued to be strong. The latest quarter brought in a lot of new business, with CyberArk signing around 230 new logos.
Customers are increasingly using more than one CyberArk solution, increasing the volume of new logo transactions. The number of seven-figure annual contract value (ACV) deals increased steadily in the third quarter as organizations allocated more budget to his Cyber ​​Ark solution. Among the major products, Privileged Access Management and Endpoint Privilege Management remain popular, and access and cloud security products are becoming more popular.
Recently, CyberArk has gained even more bullish support on Wall Street. In December, Wells Fargo called the stock “overweight” with a $250 price target, saying the company was wisely capitalizing on recent infringement activity, delivering strong SaaS growth and expanding operating margins. I raised it to . BofA earlier this month raised its target for CyberArk from $230 to $255, praising the company’s favorable competitive position and strong execution in the “undervalued” PAM market.
In December, Jefferies initiated CyberArk with a “buy” rating with a target of $250. The company believes it has a significant market advantage and can maintain its momentum, given that the macro environment appears to be stabilizing. JPMorgan raised its target from $207 to $248 and called CyberArk one of the best-positioned security software vendors. Given the current high priority of identity in security budgets, CyberArk is likely to see accelerated demand.
Oppenheimer recently raised its price target on CyberArk from $195 to $260, calling the company a leader in identity security with a rich product offering. The company believes Cyber ​​Ark can benefit from demand tailwinds from an increased attack surface and the prioritization of identity security. Oppenheimer said the company has the ability to leverage a wide range of identity platforms and leverage customers integrating security vendors, which could lead to market share growth.
