Check Point Software Technologies CHKP reported strong fourth-quarter 2021 results, wherein both the top and bottom lines not only surpassed the respective Zacks Consensus Estimate but also improved year over year.
The IT security solutions provider reported non-GAAP earnings of $2.25 per share, beating the Zacks Consensus Estimate of $2.14. The bottom line improved 4% from the year-ago quarter’s earnings of $2.17 per share.
Check Point’s quarterly revenues increased 6% year over year to $599 million, which outpaced the Zacks Consensus Estimate of $585.9 million.
Check Point stock has outperformed the Zacks Security Market industry over the past three months. CHKP stock has gained 6.8% in the last three months while the Security Market industry declined 5.8% over the same time frame.
Three-Month Price Performance
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Subscription revenues were $204 million, climbing 14% year over year on double-digit revenues in CloudGuard and Harmony solutions and a triple-digit sales increase in the Infinity platform.
Products and licenses revenues increased 3.6% year over year to $166 million. Products are currently in the process of transitioning to cloud solutions, which are included in the subscription line.
Total revenues from product and security subscriptions were $370.5 million, up 8.9% year over year.
Software update and maintenance revenues increased to $228.6 million from $223.7 million reported in the year-ago quarter.
As of Dec 30, 2021, deferred revenues were $1.71 billion, up 15% year over year.
Non-GAAP operating income for the fourth quarter of 2021 totaled $284.5 million, down from $285.3 million in the year-ago quarter. Non-GAAP operating margin contracted 400 basis points to 47%.
Balance Sheet & Other Details
Check Point exited the fourth quarter with cash and cash equivalents, marketable securities and short-term deposits of $3.78 billion compared with the previous quarter’s $3.84 billion.
The company generated cash worth $294 million from operational activities during the fourth quarter. In full-year 2021, CHKP generated $1.18 billion of operating cash flow.
It repurchased 2.8 million shares for about $325 million during the fourth quarter. In 2021, it bought back shares worth $1.3 billion.
Zacks Rank & Stocks to Consider
Check Point currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader technology sector include Analog Devices ADI, CDW Corporation CDW and NVIDIA Corporation NVDA, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Analog Devices’ first-quarter fiscal 2022 earnings has been revised upward by a penny to $1.79 per share over the past 30 days. For fiscal 2022, earnings estimates have moved upward by 1% to $7.53 per share over the past 30 days.
Analog Devices’ earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 6.1%. Shares of ADI have rallied 12.2% in the trailing 12 months.
The Zacks Consensus Estimate for CDW Corporation’s first-quarter 2022 earnings has been revised upward by five cents to $1.87 per share over the past 60 days. For 2022, earnings estimates have moved upward 12 cents to $8.73 per share in the past 60 days.
CDW Corporation’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 12.2%. CDW stock has rallied 29.7% over the past year.
The Zacks Consensus Estimate for NVIDIA’s fourth-quarter fiscal 2022 earnings has been revised upward to $1.22 per share from $1.09 90 days ago. For fiscal 2022, earnings estimates have been revised upward by a couple of cents to $4.35 per share in the past 30 days.
NVIDIA’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 7.7%. Shares of NVDA have increased 84.7% over the past year.
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