CyberArk Has Underperformed, But The Core Opportunity Is Still Attractive

It’s a rough world out there, and companies are increasingly responding to IT threats with a “Zero Trust” approach that doesn’t rely upon location to establish access. That’s good news for a host of companies, including CyberArk (CYBR), Okta (OKTA), and Microsoft (MSFT), and I like CyberArk’s decision to embrace SaaS in a bigger way, as well as buy its way into Identity Management as a complement to its Privileged Access Management core.

While I’ve long liked CyberArk, I’ve had issues with the valuation. When I last wrote about the company in June of 2019, I thought the valuation was “stretched”, and the shares have since fallen about 12% - significantly underperforming not only the NASDAQ, but both large security companies (Check Point (CHKP) and Palo Alto (PANW)) and small (Okta and Zscaler (ZS)). Even with concerns about COVID-19, the move toward SaaS, and competition, CyberArk still isn’t exactly cheap, but it’s at least cheap enough to be worth consideration.

 

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CyberArk Has Underperformed, But The Core Opportunity Is Still Attractive