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On Tuesday, DA Davidson analyst Rudy Kessinger updated his outlook on CyberArk Software (NASDAQ:CYBR), increasing the price target to $435 from the previous $415, while reiterating a Buy rating on the shares. The $17.8 billion cybersecurity company, which boasts impressive gross profit margins of 79.2%, saw its first-quarter results surpass expectations with annual recurring revenue (ARR) and other key financial metrics outperforming consensus estimates. According to InvestingPro data, the company has demonstrated strong momentum with a 57.1% return over the past year.
Kessinger noted that the company did not face additional macroeconomic challenges during the quarter. The company’s robust performance is reflected in its 33.1% year-over-year revenue growth. CyberArk’s guidance for calendar year 2025 has been revised upwards, including improvements in revenue, operating profit, earnings per share (EPS), and free cash flow (FCF). However, the ARR forecast for the same period was only reiterated, reflecting a more cautious stance by management for the rest of the year due to macroeconomic considerations. InvestingPro analysis suggests the stock is currently trading above its Fair Value, though analysts maintain a strong bullish consensus with a 1.32 rating (where 1 is Strong Buy).
The analyst expressed confidence in CyberArk’s performance, suggesting that if the trends from the first quarter continue, there is a strong possibility of exceeding the reiterated ARR guidance for calendar year 2025. Kessinger’s comments highlighted the company’s consistent execution and potential for growth, stating, "If Q1 trends persist, which we expect given the execution machine that CYBR has been, upside to reiterated CY25 ARR guidance is thus very likely."
CyberArk’s stock outlook remains positive according to DA Davidson, with the raised price target indicating a belief in the company’s ongoing success. Kessinger concluded with an affirmation of the Buy rating, emphasizing the potential for further upside: "We remain BUY rated: raising PT from $415 to $435."
In other recent news, CyberArk Software has reported robust first-quarter results for fiscal year 2025, with Annual Recurring Revenue (ARR) increasing by 50% year-over-year to approximately $1.215 billion. This performance surpassed consensus estimates and highlighted significant growth, particularly in the machine identity sector. Analysts from various firms, including TD Cowen, Guggenheim, Stifel, Truist Securities, and Mizuho (NYSE:MFG), have maintained Buy or Outperform ratings on CyberArk, with price targets ranging from $425 to $455. Despite the strong quarter, CyberArk’s management has opted for a conservative approach, maintaining their ARR and Adjusted Free Cash Flow guidance for the fiscal year amidst macroeconomic uncertainties.
The company’s strategic acquisitions, such as Venafi and Zilla, have contributed to its expanding platform, which now covers a wide range of identities. Analysts have noted CyberArk’s consistent execution and ability to adapt to the evolving cybersecurity landscape as key factors in its success. Guggenheim highlighted CyberArk’s unique position as the only stock in their coverage to post positive growth in New ARR for each quarter over the past three years. Meanwhile, Stifel pointed out the secular tailwinds benefiting the company, particularly in reducing certificate lifecycles in the cybersecurity industry.
Mizuho’s analysts expressed confidence in CyberArk’s strategic positioning to capitalize on the growing demand for identity-related solutions. The firm’s consistent performance and strategic direction have led to a reaffirmation of positive ratings and price targets by multiple analyst firms. As CyberArk continues to navigate the fiscal year with a cautious outlook, its ability to maintain momentum and capitalize on market opportunities remains a focal point for investors and market watchers.
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