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Q1 Rundown: SentinelOne (NYSE:S) Vs Other Cybersecurity Stocks


Adam Hejl /
2023/06/13 5:49 am EDT

Earnings results often give us a good indication what direction will the company take in the months ahead. With Q1 now behind us, let’s have a look at SentinelOne (NYSE:S) 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 9 cybersecurity stocks we track reported a weaker Q1; on average, revenues beat analyst consensus estimates by 0.65%, while on average next quarter revenue guidance was 1.16% under consensus. Increasing interest rates hurt growth companies as investors search for near-term cash flows, but cybersecurity stocks held their ground better than others, with the share prices up 1% since the previous earnings results, on average.

Weakest Q1: SentinelOne (NYSE:S)

With roots in the Israeli cyber intelligence community, SentinelOne (NYSE:S) provides software to help organizations efficiently detect, prevent, and investigate cyber attacks.

SentinelOne reported revenues of $133.4 million, up 70.5% year on year, missing analyst expectations by 2.36%. It was a weak quarter for the company, with revenue guidance for the next quarter and the full year missing analysts' expectations.

“Macro challenges remained, yet we continued to deliver high growth and margin improvement, demonstrating key strengths across our business. Once again we're leading the industry with the innovation in AI with our recently launched Purple AI: a one-of-a-kind innovation in cybersecurity that empowers enterprises with unparalleled capabilities to offer a real-time, autonomous response against cyber threats,” said Tomer Weingarten, CEO of SentinelOne.

SentinelOne Total Revenue

SentinelOne achieved the fastest revenue growth but had the weakest performance against analyst estimates and weakest performance against analyst estimates of the whole group. The company added 12 enterprise customers paying more than $100,000 annually to a total of 917. The stock is down 23.5% since the results and currently trades at $15.85.

Read our full report on SentinelOne here, it's free.

Best Q1: CrowdStrike (NASDAQ:CRWD)

Founded by George Kurtz, the former CTO of the antivirus company McAfee, CrowdStrike (NASDAQ:CRWD) provides cybersecurity software that protects companies from breaches and helps them detect and respond to cyber attacks.

CrowdStrike reported revenues of $692.6 million, up 42% year on year, beating analyst expectations by 2.42%. It was a decent quarter for the company, with a significant improvement in gross margin. However, there was a notable setback in terms of billings, which serves as a crucial leading indicator for near-term sales growth.

CrowdStrike Total Revenue

CrowdStrike pulled off the strongest analyst estimates beat and highest full year guidance raise among its peers. The stock is down 5.02% since the results and currently trades at $151.99.

Is now the time to buy CrowdStrike? Access our full analysis of the earnings results here, it's free.

Varonis (NASDAQ:VRNS)

Founded by a duo of former Israeli Defense Forces cyber warfare engineers, Varonis (NASDAQ:VRNS) offers software-as-service that helps customers protect data from cyber threats and gain visibility into how enterprise data is being used.

Varonis reported revenues of $107.3 million, up 11.5% year on year, in line with analyst expectations. It was a weak quarter for the company, with revenue and operating profit guidance for the full year missing analysts' expectations.

Varonis had the slowest revenue growth in the group. The stock is up 10.9% since the results and currently trades at $25.73.

Read our full analysis of Varonis's results here.

Tenable (NASDAQ:TENB)

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 $188.8 million, up 18.5% year on year, in line with analyst expectations. It was a weak quarter for the company, with revenue guidance for the next quarter and the full year missing analysts' expectations.

The stock is down 12.4% since the results and currently trades at $39.83.

Read our full, actionable report on Tenable here, it's free.

Qualys (NASDAQ:QLYS)

Founded in 1999 as one of the first subscription security companies, Qualys (NASDAQ:QLYS) provides organizations with software to assess their exposure to cyber-attacks.

Qualys reported revenues of $130.7 million, up 15.2% year on year, in line with analyst expectations. It was a decent quarter for the company, with a narrow beat of topline estimates and revenue guidance for the next quarter roughly in line with expectations.

The stock is up 18.4% since the results and currently trades at $128.21.

Read our full, actionable report on Qualys here, it's free.

The author has no position in any of the stocks mentioned