Tuesday, January 8, 2019

CyberArk's Strong Execution Should Outweigh An Imperfect Valuation

As far as I’m concerned, CyberArk (CYBR) is delivering the sort of results that a young company leading a growing (if not emerging) market ought to be delivering. Improved pricing and product positioning, better sales execution, and increasing customer awareness of the importance of privileged access management (or PAM) and secure DevOps (a software development methodology) all seem to be coming together as a strong tailwind for CyberArk going into 2019.

I liked the CyberArk story back in mid-2018, but was less excited about the valuation. The shares are up since then, but not so much that I’m really kicking myself and particularly relative to what I see as stronger underlying improvement in the business. I do worry about the risk of further market de-rating (in other words, lower multiples for stocks in general and tech stocks in particular), but CyberArk does seem undervalued and I’m reluctant to get too fussy about valuation with a strong operating story that still has room to deliver meaningful growth in the coming years.

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CyberArk's Strong Execution Should Outweigh An Imperfect Valuation

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