Please ensure Javascript is enabled for purposes of website accessibility

Why CyberArk Stock Fell 14% Today

By Joe Tenebruso - Feb 12, 2020 at 4:28PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The cybersecurity specialist reined in investors' expectations for the year ahead.

What happened

Shares of CyberArk (CYBR 0.38%) plunged nearly 14% on Wednesday, following the release of the cybersecurity leader's fourth-quarter results. 

So what

CyberArk's revenue jumped 19% year over year to $129.7 million. That was slightly above Wall Street's expectations for revenue of $126.2 million. The gains were driven by a 15% rise in license revenue, to $76.5 million, and a 26% increase in maintenance and professional services revenue, to $53.1 million.

CyberArk's fourth-quarter earnings also came in nicely above analysts' estimates. Non-GAAP (adjusted) net income rose 13% to $37.8 million, or $0.97 per share, besting the consensus forecast for adjusted earnings per share (EPS) of $0.80. 

"Our record fourth-quarter results capped off another great year of strong growth driven by disciplined investments," CyberArk Chairman and CEO Udi Mokady said in a press release. "We were thrilled to win a record number of logos in the fourth quarter, signing nearly 300 new customers." 

Despite these solid results, investors appear to be focusing on CyberArk's forward guidance.

A digital lock inside a digital circle

CyberArk investors' screens were flashing red on Wednesday. Image source: Getty Images.

Now what

For 2020, CyberArk expects revenue of $511 million to $519 million, representing healthy growth of approximately 19% at the midpoint of this range. However, CyberArk's full-year 2020 adjusted earnings-per-share guidance of $2.26 to $2.38 disappointed investors. Analysts had been forecasting adjusted EPS of $2.75 in 2020. 

Still, Mokady believes CyberArk's long-term prospects remain bright.

"Throughout 2019, organizations continued to recognize that protecting privileged access is foundational to a comprehensive security program and increasingly turned to CyberArk as a trusted advisor, particularly to secure mission-critical digital transformation and cloud migration strategies," Mokady said. "Our clear leadership position in the market and ongoing commitment to deliver innovation positions us well to deliver profitable growth in 2020 and beyond."

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

CyberArk Software Ltd. Stock Quote
CyberArk Software Ltd.
CYBR
$130.64 (0.38%) $0.49

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
338%
 
S&P 500 Returns
119%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/17/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.