Check Point Software Earns $1.30 per Share

This morning, Check Point Software (CHKP) had a decent earnings report, but they lowered guidance so the stock is taking a hit. The details aren’t quite as bad as the stock action suggests.

Let’s dig into the numbers. For Q1, Check Point reported earnings of $1.30 per share. That was two cents better than estimates. Revenue rose 4% to $452 million, and cash flow from operations increased by 18% to $419 million. They had previously given Q1 guidance for earnings between $1.25 and $1.30 per share and revenues of $440 to $460 million.

Those numbers are pretty good, and this is what the company had to say:

“First quarter revenues were above the midpoint of our projections while EPS reached the top of our guidance range.” Said Gil Shwed, Founder and CEO of Check Point Software Technologies. “The global cyber threat landscape is becoming increasingly sophisticated. Attacks are now in their 5th generation, while 97 percent of enterprises are not prepared for these attacks and remain primarily focused on protections for 2nd or 3rd generation attacks. During the first quarter we introduced the Infinity Total Protection Gen V prevention solution, along with its CloudGuard family of security products, and both solutions generated nice wins in the quarter.” Shwed Continued.

Now we get to the disappointing news, which is the weak guidance. For Q2, Check Point expects revenue to range between $445 and $475 million. Wall Street had been expecting $477 million. For Q2 EPS, their range is $1.25 to $1.35. Wall Street had been expecting $1.35 per share.

Check Point also cut their full-year earnings range. The previous guidance was $5.50 to $5.90 per share. The new range is $5.45 to $5.75 per share. They also lowered their full-year revenue forecast from $1.9 billion – $2 billion to $1.85 billion – $1.93 billion.

Posted by on April 25th, 2018 at 9:19 am


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