CyberArk Software CYBRis set to report first-quarter 2018 results on May 3. The question lingering on investors’ mind is whether this provider of information technology security solutions will be able to deliver an earnings surprise this time.
Notably, the company surpassed the Zacks Consensus Estimate in each of the trailing four quarters with an average positive earnings surprise of 19.
Let’s see how things are shaping up prior to this announcement.
Factors to Consider
CyberArk’s investments in enriching its product suite and go-to-market sales strategies are benefiting the company and helping it to add customers, thereby boosting revenues.
Notably, the company made a comeback in the previous two quarters, after slowest revenue growth rate of 14% recorded in the second quarter of 2017. The first quarter’s guidance of 16-18% growth rate keeps us optimistic.
The company’s acquisitions continue to contribute to revenues. DevOps security software provider, Conjur, which was acquired by the company in September 2017, has been receiving strong customer response.
CyberArk acquired certain assets of privately-held cloud security provider, Vaultive in March. The integration of Vaultive is expected to enhance the solution to address the needs of diverse users as well as administrators of Software-as-a-Service (SaaS), Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) projects.
However, we are apprehensive about increasing operating expenses related to enhancing its sales competency and enriching the solutions suite. Though these investments will have benefits over the long term, we anticipate these to be a drag on the company’s profitability and the bottom line in the near term.