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On Wednesday, DA Davidson revised its price target for Tenable Holdings Inc . (NASDAQ:TENB), a cybersecurity company, dropping it to $28 from the previous $45, while maintaining a Neutral rating on the shares. According to InvestingPro data, analyst targets for Tenable currently range from $28 to $52, with the stock trading at $30.69. The adjustment followed Tenable’s first-quarter earnings report, which exceeded consensus expectations in several key metrics, including Revenue (Rev), Calculated Current Billings (CCB), and Unlevered Free Cash Flow (UFCF).
The company’s Q1 performance showcased robust growth, with financial figures surpassing analyst forecasts. With impressive gross profit margins of 78% and revenue growth of 11.8% over the last twelve months, Tenable demonstrates strong operational efficiency. Nonetheless, Tenable’s outlook for the full year 2025 was less optimistic than initially anticipated. The firm reduced its CCB growth projections for the calendar year 2025 from the previous range of 8-9% year-over-year to a more modest 6-7%.
This downward revision in guidance is primarily attributed to a cautious stance regarding public sector spending in the second half of the year. About two-thirds of the reduced CCB expectations stem from this conservative view, which was already factored into the first half of the year’s guidance. The remaining one-third of the reduction is due to expectations from the private sector.
Despite the company’s strong quarter and positive management commentary, the lowered guidance has significantly impacted investor sentiment. Following the announcement, Tenable’s stock price indicated a sharp decline of 18% in after-hours trading, pushing the stock near its 52-week low of $29.99. This response underscores the weight that future expectations hold on the market’s perception of a company’s value, even in the face of strong current performance. InvestingPro analysis suggests the stock may be slightly undervalued at current levels, with additional insights available in the comprehensive Pro Research Report, part of InvestingPro’s coverage of over 1,400 US stocks.
In other recent news, Tenable Holdings, Inc. reported its first-quarter 2025 earnings, surpassing Wall Street expectations with earnings per share of $0.36, compared to the forecasted $0.28. The company achieved a revenue of $239.1 million, exceeding projections of $233.73 million. Despite these strong financial results, Tenable’s stock experienced a significant drop in aftermarket trading. Analysts from Cantor Fitzgerald, Scotiabank (TSX:BNS), and Needham adjusted their price targets for Tenable, with Cantor reducing it to $42, Scotiabank to $30, and Needham to $35, all while maintaining their respective ratings. The revisions followed Tenable’s cautious guidance for the second quarter and full year, citing macroeconomic uncertainties and challenges in the U.S. public sector. The company also launched new AI and cloud security capabilities, which contributed to its first-quarter success. Analysts noted Tenable’s consistent performance and potential for growth, highlighting the company’s strategic focus on expanding its exposure management platform and cloud security offerings.
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