Tag Archives: impv

Broad Security Freeze: Palo Alto Demand Stalls; Q2 Views Lukewarm

Palo Alto Networks ( PANW ) stock tumbled Thursday after a Piper Jaffray analyst said that lackluster April demand and Q2 guidance from Check Point Software Technology ( CHKP ), FireEye ( FEYE ) and Imperva ( IMPV ) could signal a broad cybersecurity slowdown. IBD’s 26-company Computer Software-Security industry group is down 18.5% for the year after toppling 32% through Feb. 9, on bleak guidance for IT spending from firms like LinkedIn ( LNKD ) and Tableau Software ( DATA ). Barracuda Networks ( CUDA ), Check Point, FireEye and Fortinet ( FTNT ) recently missed full-year views. Imperva and Proofpoint ‘s ( PFPT ) Q2 outlooks lagged the consensus. Now, channel checks show April demand slowed, Piper Jaffray analyst Andrew Nowinski says. “The key takeaway from Q1 earnings season is that the security sector is starting to show signs of slowing based on the guidance that was provided for Q2 and fiscal 2016,” he wrote in a research report Thursday. Cybersecurity stocks toppled Thursday on Nowinski’s assessment. IBD’s security group was down 2% in morning trading on the stock market today , with Palo Alto Networks and FireEye stocks leading the deluge, down a respective 6% and 4%. Palo Alto Networks stock was at a two-month low, near 130. IBD’s Take: How does Palo Alto Networks stack up, and how does it compare to its rivals? Find out at IBD Stock Checkup But some analysts say Palo Alto Networks could beat guidance when it posts fiscal Q3 earnings on May 26. The company has topped the high-end of its outlook by an average 5.6% for the past 11 quarters. To do so again, Palo Alto would have to report $356 million in sales. The consensus of 43 analysts polled by Thomson Reuters models $339.4 million in April-quarter sales, which would be up 45% vs. the year-earlier quarter. But $549.5 million in July-quarter billings expectations, up 40%, might be too aggressive, Nowinski wrote. During the April quarter, some delays in large contracts likely hurt Palo Alto Networks, Nowinski wrote. “Most (resellers) thought it was simply due to a ‘digestion period’ where customers were still trying to integrate products they purchased in 2015,” he wrote. “The results definitely indicate demand slowed sequentially and also on a year-over-year basis.” Nowinski expects Palo Alto Networks to at least meet estimates, but he cut his price target on Palo Alto Networks stock to 180 from 208. He reiterated an outperform rating, but wrote that “this is the first quarter in at least two years where we picked up any sort of slowdown in Palo Alto’s demand trends.”

CyberArk Yanked On Imperva ‘Quota’ Blunder, Lagging FireEye Sales

Cybersecurity stocks toppled broadly Friday despite a  CyberArk Software ( CYBR ) blowout Q1, losing ground on disappointing results from FireEye ( FEYE ) and Imperva ( IMPV ) that included, respectively, a sudden CEO shift and ousted EMEA management on lagging sales. IBD’s 26-company Computer Software-Security industry group, which already ranks a lowly No. 178 of 197 groups tracked, was down 5.5% in morning trading on the stock market today , touching a more than two-month low. Imperva and FireEye stocks led the deluge, down a respective 26% and 18%, near 33.50 and 13. CyberArk stock was down 2%, near 39.50. In fact, the only stocks on the rise in the sector were tiny Mimecast ( MIME ) and Qualys ( QLYS ), which was up just a fraction. Viewfinity ‘Meaningfully’ Helps CyberArk Late Thursday, CyberArk reported 43% year-over-year sales growth to $46.9 million and 23 cents earnings per share, up 44% vs. the year-earlier quarter. Both metrics topped the consensus of 17 analysts polled by Thomson Reuters for $43.4 million and 16 cents. Current-quarter guidance for $47.5 million to $48.5 million in sales and 18-20 cents EPS ex items beat Wall Street’s forecast for $47.5 million and 18 cents at the midpoints. On a year-over-year basis, sales would be up 32%, and EPS minus items would be flat. License sales drove CyberArk’s Q1, up 38% to $27.5 million (59% of total revenue), leading 41% growth in the maintenance and professional services segment. Q1 marked acquisition Viewfinity’s first “meaningful contribution,” Piper Jaffray analyst Andrew Nowinski wrote in a research report. Nowinski reiterated an overweight rating and 55 price target on CyberArk stock, noting “broad adoption” across all segments. “They are seeing increased activity with midsize organizations, including universities, credit unions and law firms, which supports the belief that firms of all sizes need this layer of security,” he wrote. Government growth included six-figure deals in all three regions. FireEye Sees ‘Inflection Point’ Dougherty analyst Catharine Trebnick called FireEye’s Q1 an “inflection point” that saw subscriptions replace products as FireEye’s leading segment — up 71% vs. down 16% on a year-over-year basis. The unexpected transition caused FireEye’s Q1 sales to miss but billings to fly. And CEO David DeWalt stepped down to executive board chairman, succeeded by Kevin Mandia, Mandiant founder. FireEye acquired Mandiant in 2014, and Mandia has held several positions at FireEye since. Late Thursday, FireEye reported $168 million in sales and $186 million in billings minus items, up a respective 34% and 23%. A 47-cent loss per-share ex items shrunk by a penny vs. last year’s loss. Billings topped FireEye’s $163 million-$183 million model, and losses beat the consensus of 35 analysts polled by Thomson Reuters for 50 cents. But sales missed the projection for $171.8 million, and on Friday, at least four analysts cut their price targets on FireEye stock. Of the 28 deals worth more than $1 million, 80% included multiple products/subscriptions, and 50% had three or more, Trebnick wrote in a report. More than half of the seven-figure deals included FireEye-as-a-Service — or cloud — products. Trebnick is neutral on FireEye stock. For the current quarter, FireEye guided to $178 million to $185 million in sales, up 23% at the midpoint, and a 38-cent to 40-cent per-share loss minus items, missing the consensus for $192.8 million and a 36-cent loss. Billings views for $200 million to $215 million would be up 16%. Imperva’s ‘Doubly Whammy’ Hits Q1 Imperva, on the other hand, experienced a “double whammy” during Q1 as Web-application firewall and Europe/Middle East/Asia sales stalled, prompting the firm to shift channel priorities and remove its EMEA head of sales. Summit Research analyst Srini Nandury reiterated a buy rating but trimmed his price target on Imperva stock to 50 from 70. Imperva trimmed Q2 guidance but inched 2016 views up — the latter of which Nandury sees as an impossibility. “We worry that the year will be back-end-loaded with no margin of error,” he wrote in a report. For Q1, Imperva reported $59.8 million in sales, up 34%, and a 25-cent per-share loss minus items vs. a 26-cent loss in the year-earlier quarter. Sales met Wall Street expectations, while losses were better by 3 cents. Imperva’s Q2 view for $65.5 million to $66.5 million in sales would be up 23%, but it missed the consensus of 22 analysts polled by Thomson Reuters for $70.2 million. The company’s outlook for a 2-cent to 4-cent loss per share ex items edged views for a 4-cent loss. “Guidance was lowered mainly due to sales execution challenges in EMEA and U.S.,” Nandury wrote in a report. “Some sales force reps were only selling Database Security product so that they can close out their quota for the quarter, while ignoring lower-priced WAF products.” But Nandury sees the issues as fixable. Gartner, IDC and Forrester industry trackers rate Imperva’s products highly, he wrote. Amazon.com ‘s ( AMZN ) Amazon Web Services cloud business can’t touch Imperva’s Database Security, he said. “We do not see evidence that enterprises are going to rely on cloud providers such as AWS to provide security to their data,” he wrote.

Palo Alto Networks Gouges Cisco, Check Point, Fortinet: Survey

Palo Alto Networks ( PANW ) gouged rivals Cisco Systems ( CSCO ) and Check Point Software Technologies ( CHKP ) during Q1, as Fortinet ( FTNT ) and Symantec ( SYMC ) demand toppled, according to a Piper Jaffray survey of 26 resellers and distributors. Meanwhile, cybersecurity vendors Imperva ( IMPV ) and FireEye ( FEYE ) improved on Q4 demand, and CyberArk Software ( CYBR ) and Proofpoint ( PFPT ) demand remained relatively stable. Cybersecurity stocks largely fell as of midday trading on the stock market today , with IBD’s 25-company Computer Software-Security industry group down nearly 1.5%. Proofpoint and Fortinet stocks led the plunge, both down more than 4% midday Tuesday. CyberArk stock was down more than 2%, and Palo Alto Networks stock was down more than 1%. Imperva was down more than 2.5%, and FireEye fell nearly 2%. Symantec and Check Point stocks bucked the trend, trading flat and up 1%, respectively. Check Point is losing to Palo Alto Networks, according to resellers surveyed by Piper Jaffray analyst Andrew Nowinski, but half of the resellers cited Cisco as the rival Palo Alto Networks beats out most frequently. “Cisco and Check Point have consistently been called out by resellers as the vendors most frequently losing to Palo Alto,” Nowinski wrote in a research report. In Q4 and Q3, Juniper Networks was also cited by 13% and 18% of resellers as losing to Palo Alto Networks. “However, this is the first quarter resellers cited Fortinet as competition to Palo Alto, suggesting Fortinet may be moving more upstream into the mid-market enterprise space,” Nowinski wrote. Only 35% of resellers sold more Palo Alto Networks products than they expected, Nowinski wrote, down from 56% in Q4. The largest distributors say Palo Alto Networks demand trends were unchanged, he added. Imperva jumped in Q1, as 20% of resellers were above plan vs. 8% in Q4. And FireEye demand improved to 31% below plan from 36% in Q4. CyberArk and Proofpoint were largely in line. But Fortinet and Symantec declined. In Q1, 31% of Fortinet resellers were below plan vs. 14% in Q4. Symantec fell to 50% below plan vs. 29% in the prior quarter.