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On Wednesday, Citi reaffirmed its confidence in CyberArk Software (NASDAQ:CYBR), maintaining a Buy rating and a price target of $410.00. This target aligns with the broader analyst consensus, as revealed by InvestingPro data showing analyst targets ranging from $303 to $500, though the stock is currently trading above its calculated Fair Value. The endorsement comes after CyberArk reported strong financial results and provided an initial forecast that met high market expectations. The company’s impressive 79.2% gross profit margins and robust revenue growth of 33.1% in the last twelve months support this positive outlook. InvestingPro analysis reveals 16 analysts have revised their earnings upward for the upcoming period, with expectations of profitability this year despite current negative earnings. Citi analyst Fatima Boolani provided insights from a recent discussion with CyberArk’s CFO Smith, highlighting several key points of interest for investors.
Fatima Boolani pointed out that Term customers are increasingly aligning their contracts with SaaS expansions, which impacts the company’s reported earnings due to the way subscription durations are accounted for. The analyst also noted that CyberArk is handling foreign exchange impacts in a detailed manner, considering the timing of contract renewals.
CyberArk’s brand strength is reportedly accelerating the conversion of its Venafi pipeline, potentially increasing deal sizes in some instances. This positive development occurs even though the company doesn’t influence pipeline generation within the quarter. Looking ahead, Boolani mentioned that Venafi’s SaaS bookings mix is expected to grow to approximately 70-75%, a significant increase from the previous year. Additionally, new intellectual property from Zilla is set to contribute $8-10 million in annual recurring revenue, up from the current $5 million.
The analyst emphasized that Zilla’s new offerings are particularly aimed at modern use cases and cloud-based environments, indicating a strategic move to work more collaboratively with ecosystem partner SailPoint. The detailed notes from the conversation with CFO Smith further underscore the strategic initiatives CyberArk is undertaking to strengthen its market position and capitalize on emerging opportunities in cybersecurity. With a market capitalization of $20.2 billion and strong financial health indicators, including more cash than debt on its balance sheet, the company appears well-positioned for growth. For deeper insights into CyberArk’s financial health and growth prospects, investors can access the comprehensive Pro Research Report available on InvestingPro, which includes over 15 additional valuable insights and metrics.
In other recent news, CyberArk Software has been the subject of several analyst upgrades. BofA Securities raised its price target for the company to $500, citing CyberArk’s strong position in the evolving Identity Security market and a substantial increase in its annual recurring revenue (ARR) and revenue growth, notably due to the acquisition of Venafi. Similarly, Stifel analysts increased their price target to $444, highlighting the company’s impressive fourth-quarter results and the strategic acquisitions of Venafi and Zilla Security.
Baird analysts also raised their price target for CyberArk to $455, noting the company’s significant strides with its Venafi acquisition and the fast-growing Secrets Management segment. They also mentioned the potential for further growth from cross-selling efforts. KeyBanc Capital Markets increased its price target to $485 following CyberArk’s robust fourth-quarter performance, with the ARR figure surpassing expectations and the guidance for 2025 exceeding market consensus.
Finally, William Blair maintained an Outperform rating on CyberArk, acknowledging the company’s comprehensive platform, strategic acquisitions, and strengthening position as a difficult-to-replace partner for companies aiming to bolster their zero-trust security architectures. These recent developments indicate a positive trajectory for CyberArk in the cybersecurity sector.
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