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On Thursday, Stephens analyst Todd Weller adjusted the price target for Checkpoint Software (NASDAQ:CHKP), bringing it down to $229 from the previous $255. Despite this change, the analyst maintained an Equal Weight rating on the company’s stock. According to InvestingPro data, the company maintains impressive gross profit margins of 88.26% and holds more cash than debt on its balance sheet, supporting its solid financial position. Weller’s assessment came after a review of Checkpoint’s first quarter 2025 results, which he described as solid, indicating a steady demand for cybersecurity in the March quarter.
Checkpoint Software has been experiencing robust appliance refresh activity and has not yet observed any significant macroeconomic headwinds. The company’s revenue grew 6.4% in the last twelve months, and InvestingPro analysis shows 13 analysts have revised their earnings upwards for the upcoming period. However, the company has adopted a cautious approach to its second quarter 2025 guidance, while still upholding its outlook for the full year.
Weller noted that under the new leadership, there is potential for Checkpoint to achieve double-digit top-line growth. Nevertheless, he believes that realizing this growth will require time and that the current economic uncertainties add a layer of risk to the company’s outlook.
The revised price target of $229 is based on a more conservative target multiple of around 20 times the firm’s forecasted fiscal year 2026 free cash flow. Weller’s commentary suggests a careful optimism for Checkpoint’s future performance, tempered by current market conditions and a conservative fiscal outlook.
In other recent news, Check Point Software Technologies Ltd. reported first-quarter earnings and revenue that surpassed analyst expectations. The company posted adjusted earnings per share of $2.21, exceeding the consensus estimate of $2.19. Revenue increased by 7% year-over-year to $638 million, outpacing expectations of $636.22 million. Product and license revenue saw a 14% rise, reaching $114.1 million, driven by strong demand for the Quantum Force appliances. Additionally, security subscription revenue went up by 10% to $290.6 million. Raymond (NSE:RYMD) James maintained an Outperform rating on Check Point, highlighting the company’s robust growth trends and stable forward guidance despite macroeconomic challenges. The firm noted that Check Point’s second-quarter revenue guidance slightly surpasses previous growth assumptions, indicating improved investor sentiment. The company is also expanding its international market share and has a substantial financial reserve to support growth initiatives.
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