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CyberArk Boosts Its Venafi Product Line: What Should Investors Do?

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CyberArk (CYBR - Free Report) shares have risen 25.2% year to date (YTD), outperforming the Zacks Computer - Software industry’s growth of 7.7%.

CYBR stock has also outperformed the Zacks Computer and Technology Sector and the S&P 500 index in the YTD period. The Zacks Computer and Technology sector and the S&P 500 index have returned 22.6% and 20%, respectively, YTD. This outperformance reflects investors’ confidence in CyberArk’s position in the cybersecurity market.

CyberArk has been consistently focusing on enhancing its product portfolio. Recently, its wholly-owned subsidiary, Venafi, launched new features in its Control Plane for Machine Identities product. Through these features, Venafi will be able to provide services like machine identity security, cloud-to-cloud connectivity and workload identity security.

The enhancement also promises to deliver post-quantum cryptography support that is expected to be beyond quantum computer’s decoding capabilities. Venafi’s latest product updates include support for NIST-approved post-quantum algorithms like Multivariate Linear Digital Signature Algorithm and Structured Lattice-based Hash Digital Signature Algorithm.

Cloud-to-cloud connectivity will ensure multi-cloud connectivity that will enable security teams to access Microsoft’s (MSFT - Free Report) Azure, Amazon’s (AMZN - Free Report) Amazon Web Services and Alphabet’s (GOOGL - Free Report) Google Cloud Platform. News capabilities like Workload Identity Federation will enable users to minimize security risks with the use of Venafi Control Plane APIs in place of traditional API keys.

CyberArk YTD Performance

Zacks Investment Research
Image Source: Zacks Investment Research

CyberArk Enhances Products With Partnerships

CyberArk has long been a partner with tech giants like Microsoft, Amazon and Alphabet. CYBR has also integrated its solutions with Microsoft’s Azure Active Directory for improving its ability to secure cloud environments, offering robust identity management solutions across various IT ecosystems.

CyberArk’s partnership with Amazon enables seamless integration of CYBR’s security solutions with AWS’ cloud environment. This integration ensures that customers can protect their critical workloads adequately. CYBR’s collaboration with Google Cloud strengthens the company’s position in the hybrid cloud security market, offering advanced tools to secure digital assets.

These partnerships not only expand CyberArk’s market reach but also provide customers with comprehensive and integrated security solutions, making CyberArk an indispensable player in today’s cybersecurity landscape.

CyberArk’s Strong Financials

CyberArk’s recent better-than-expected second-quarter 2024 performance is a testament to its strong position in the Cybersecurity space. Second-quarter revenues grew 24% year over year on strong demand, while efficient cost management and lower shares outstanding led to an 18-fold jump in non-GAAP earnings per share (EPS).

Buoyed by the stronger-than-expected second-quarter performance, CyberArk has raised guidance for full-year 2024. The company now expects 2024 revenues in the range of $932-$942 million and non-GAAP EPS between $2.17 and $2.36.

The Zacks Consensus Estimate for revenues and non-GAAP EPS is pegged at $939.1 million and $2.29. The consensus mark for the top and bottom lines indicates a robust year-over-year increase of approximately 25% and 104%, respectively.

What Should Investors Do?

CyberArk’s sustained focus on enhancing its offerings through innovations and partnerships will continue driving its financial performance. The company will continue benefiting from a strong demand environment for cybersecurity solutions, making the stock a compelling investment option.

Additionally, CyberArk currently carries a Zacks Rank #2 (Buy) and has a VGM Score of B. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or #2, offer the best investment opportunities for investors. CyberArk stock appears to be a compelling investment proposition at the moment.  You can see the complete list of today’s Zacks #1 Rank stocks here.

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