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Is This Top Cybersecurity Stock a Buy Before Earnings?

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Key Takeaways

  • CyberArk, a global leader in identity security, is a current Zacks Rank #1 (Strong Buy) stock.
  • CYBR shares have been strong year-to-date, gaining 32% and outperforming the S&P 500.
  • Register now to see our 7 Best Stocks for the Next 30 Days report - free today!

Zacks Thematic Screens lets you dive into 30 dynamic investment themes shaping the future. Whether you're interested in cutting-edge technology, renewable energy, or healthcare innovations, our themes help you invest in ideas that matter to you.

For those interested in viewing the Thematic lists, please click here >>> Thematic Screens – Zacks Investment Research.

Let’s take a closer look at the ‘Cybersecurity’ theme and analyze a stock that the screen returned, namely CyberArk Software (CYBR - Free Report) . The company is on the reporting docket for this week, with its results scheduled for Wednesday before the market’s open.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

Let’s take a closer look at how expectations presently stack up.

CyberArk Enjoys Momentum

 

CyberArk, a current Zacks Rank #1 (Strong Buy), is a global leader in identity security. The company provides the most comprehensive security offering for any identity across business applications, distributed workforces, hybrid cloud environments, and throughout the DevOps lifecycle.

Shares have been strong year-to-date, gaining 32% and outperforming relative to the S&P 500 on the back of strong quarterly results. Expectations have remained muted over recent months, though solid growth is expected, with CYBR forecasted to post 7% EPS growth on 22% higher sales.

Below is a chart illustrating the company’s sales on a quarterly basis.

Zacks Investment Research
Image Source: Zacks Investment Research

Concerning its latest print, CyberArk delivered record revenue and saw a profitability uptick, also outperforming its previous guidance across all metrics. The company has overall enjoyed a snowball of demand, with Subscription revenue of $158.4 million throughout Q2 nearly 50% higher than the year-ago figure.

CYBR raised its guidance following its latest print, and it’s reasonable to expect further positive commentary surrounding the long-term outlook if Subscription sales continue to melt higher. Shares currently trade at high valuation multiples, reflective of investors’ big growth expectations.

While we haven’t seen any revisions for the upcoming print, the outlook for its broader current fiscal year has continued to remain bullish in a big way, with the $2.30 Zacks Consensus EPS estimate up nearly 40% over the last year.

Zacks Investment Research
Image Source: Zacks Investment Research

Bottom Line

Zacks Thematic Screens lets you dive into 30 dynamic investment themes shaping the future. Whether you're interested in cutting-edge technology, renewable energy, or healthcare innovations, our themes help you invest in ideas that matter to you.

Upon running the Zacks Cybersecurity Thematic screen, CyberArk Software (CYBR - Free Report) , who reports quarterly results this week, was returned.

The setup heading into the release is overall positive, with decent growth expected. Recent quarterly prints have been notably positive, and the momentum doesn’t appear to be slowing anytime soon. Though shares have already enjoyed a big run year-to-date, further gains could easily come following another robust quarterly print.

In addition, shares are currently hovering near all-time highs, a bullish sign. Stocks making new highs tend to make even higher highs, especially when positive earnings estimate revisions are present. Overall, the stock remains a prime selection for those seeking cybersecurity exposure, though investors should be aware of its volatile nature being a high-growth stock.


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