Wedbush maintained its Outperform rating on Check Point Software Technologies (NASDAQ:CHKP) while raising its price target on the stock to $150 from $135 reflecting incremental confidence in the company in 2024.
Wedbush analysts said that Check Point delivered a solid quarter featuring a slight top-line miss while beating on the bottom-line as the company focuses on balancing growth initiatives with cost management during a difficult macro backdrop.
Subscriptions increased 14% and came in ahead of the Street as a focus for the bulls. Billings were $566.3M, compared to Street’s estimate of $574.7M as longer deal cycles continued to delay product refresh cycles and long-term project spending.
The company generated total revenue of $588.7M, compared to the Street’s forecast of $589.7M with increases to security subscription revenues, including Harmony Email and Infinity, showing the company’s priority to steer growth as the cyber threat arena expands with continued advancement of malware capabilities.
The firm added that the company provided a conservative but healthy outlook for Q3’23 with revenues to be in the range of $570M to $605M versus the Street’s estimate of $600.2M estimate and non-GAAP EPS to be between $1.97 to $2.07, compared to the Street’s forecast of $1.97, as the company sees continued benefits from its recurring revenue products in spite of a shaky macro backdrop.
The company reiterated its FY23 guidance for revenue and EPS and remained confident in growing demand for its suite of cyber products as it noticed this quarter was back-end loaded due to longer sales cycles pointing to more strength in the last half of the year.
The analysts added that, as vendor consolidation is expected to continue across industries, Check Point remains in a great position to navigate the uncertain macro to increase demand as cyber malware becomes more sophisticated with new AI capabilities on the horizon.
More on Check Point
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- Source: https://seekingalpha.com/news/3992224-wedbush-maintains-outperform-rating-on-check-point-on-healthy-guidance?utm_source=feed_news_all&utm_medium=referral