As we reflect back on the just completed Q4 cybersecurity sector earnings season, we dig into the relative performance of Okta (NASDAQ:OKTA) and its peers.
Cybersecurity continues to be one of the fastest growing segments within software for good reason. Almost every company is slowly finding itself becoming a technology company and facing rising cybersecurity risks. Businesses are accelerating adoption of cloud based software, moving data and applications into the cloud to save costs while improving performance. This migration has opened them to a multitude of new threats, like employees accessing data via their smartphone while on an open network, or logging into a web-based interface from a laptop in a new location.
The 10 cybersecurity stocks we track reported a strong Q4; on average, revenues beat analyst consensus estimates by 5.66%, while on average next quarter revenue guidance was 3.48% above consensus. Tech stocks have been under pressure since the end of last year, but cybersecurity stocks held their ground better than others, with the share price up 15.1% since earnings, on average.
Founded during the aftermath of the financial crisis in 2009, Okta (NASDAQ:OKTA) is a cloud-based software as a service platform that helps companies manage identity for their employees and customers.
Okta reported revenues of $383 million, up 63.1% year on year, beating analyst expectations by 6.45%. It was a strong quarter for the company, with an impressive beat of top-line results and revenue guidance for the full year above analyst estimates.
"Identity management is at the forefront of today's rapidly evolving security environment," said Todd McKinnon, Chief Executive Officer and co-founder of Okta.
The stock is down 21.7% since the results and currently trades at $143.
Is now the time to buy Okta? Access our full analysis of the earnings results here, it's free.
Best Q4: SailPoint (NYSE:SAIL)
Started by Mark McClain after his previous identity management company got acquired by Sun Microsystems, SailPoint (NYSE:SAIL) provides software for organizations to manage the digital identity of employees, customers, and partners.
SailPoint reported revenues of $135.5 million, up 31.2% year on year, beating analyst expectations by 19.1%. It was an exceptional quarter for the company, with a significant improvement in gross margin compared to the previous quarter, and an impressive beat of analyst estimates.
SailPoint delivered the strongest analyst estimates beat among its peers. The stock is up 54.7% since the results and currently trades at $64, partly on the announcement that it has entered into a definitive agreement to be acquired by Thoma Bravo.
Is now the time to buy SailPoint? Access our full analysis of the earnings results here, it's free.
Weakest Q4: ForgeRock (NYSE:FORG)
Founded in Norway by former Sun Microsystems engineers, ForgeRock (NYSE:FORG) offers software as a service that helps companies secure and manage the identity of their customers and employees.
ForgeRock reported revenues of $47.9 million, up 19.3% year on year, beating analyst expectations by 1.69%. It was a weak quarter for the company, with a decline in gross margin and an underwhelming revenue guidance for the next quarter.
ForgeRock had the weakest full year guidance update in the group. The stock is up 34.5% since the results and currently trades at $22.30.
Founded in 2002 by three cybersecurity veterans, Tenable (NASDAQ:TENB) provides software as a service that helps companies understand where they are exposed to cyber security risk and how to reduce it.
Tenable reported revenues of $149 million, up 26.1% year on year, beating analyst expectations by 3.09%. It was a strong quarter for the company, with a solid beat of top-line results and full-year guidance beating analysts' expectations.
The stock is up 13.7% since the results and currently trades at $59.05.
Founded in 2000 with the idea that network security comes before endpoint security, Rapid7 (NASDAQ:RPD) provides software as a service that helps companies understand where they are exposed to cyber security risks, quickly detect breaches and respond to them.
Rapid7 reported revenues of $151.6 million, up 34% year on year, beating analyst expectations by 3.94%. It was an ok quarter for the company, with an underwhelming growth in customer count (Rapid7 recently updated its customer count methodology) and full-year guidance beating analysts' expectations.
The company added 374 customers to a total of 10,283. The stock is up 6.62% since the results and currently trades at $107.
The author has no position in any of the stocks mentioned