On Thursday, SentinelOne Inc (NYNYSE:SE: S) shares maintained its Sector Weight rating according to KeyBanc, following the company's latest earnings report. The cybersecurity firm reported a modest $3 million annual recurring revenue (ARR) beat and a slight guidance raise for its fiscal fourth quarter revenue.
Despite not observing widespread displacement of competitor CrowdStrike (NASDAQ:CRWD) by SentinelOne, as previously speculated, KeyBanc noted that management did report several instances where SentinelOne outperformed CrowdStrike, including securing a Fortune 50 company and various federal and local agencies. Moreover, the company achieved a record number of competitive wins against CrowdStrike in the third quarter.
Looking forward, KeyBanc anticipates discussions among investors will likely center around the potential long-term effects of a recent CrowdStrike outage on the competitive dynamics within the endpoint security market.
Other focal points for investor consideration include the significance of SentinelOne's partnership with Lenovo and the company's capacity to expand into adjacent markets such as Security Information and Event Management (SIEM), Cloud Native Application Protection Platform (CNAPP), Identity, and Generative AI.
KeyBanc expressed optimism regarding SentinelOne's progress in broadening its platform and the possible advantages stemming from the CrowdStrike service interruption and the Lenovo partnership. However, the firm remains cautious.
The caution stems from the limited upside observed this quarter and uncertainties about SentinelOne's ability to sustain robust growth and meaningful margin improvements in a highly competitive endpoint market.
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