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How Does Barracuda Networks Compare to Its Peers?

Gabriel Kane

US Equity Market Update for September 29, 2015

(Continued from Prior Part)

Barracuda and its peers

An analysis of Barracuda’s income statement in 2Q16 follows:

  • The gross profit margins of Barracuda Networks (CUDA), Check Point Software Technologies (CHKP), Symantec (SYMC), Palo Alto Networks (PANW), and Juniper Networks (JNPR) are 79.66%, 88.60%, 83.06%, 73.82%, and 63.94%, respectively.

An analysis of Barracuda’s balance sheet in 2Q16 follows:

  • The current ratios of Barracuda, Check Point Software, Symantec, Palo Alto Networks, and Juniper are 1.15, 1.70, 1.24, 1.04, and 1.55, respectively.

An analysis of Barracuda’s valuation follows:

  • The price-to-sales ratios of Barracuda, Check Point Software, Symantec, Palo Alto Networks, and Juniper are 4.33x, 9.14x, 2.10x, 15.37x, and 2.13x, respectively.

According to the above findings, the peers outperformed Barracuda Networks based on the gross profit margin and current ratio.

ETFs that invest in Barracuda Networks

The PureFunds ISE Cyber Security ETF (HACK) invests 4.34% of its holdings in Barracuda. HACK tracks a tiered and equal-weighted index that targets companies actively involved in providing cybersecurity technology and services.

The PowerShares Dynamic Networking Portfolio (PXQ) invests 2.83% of its holdings in Barracuda. PXQ tracks a quantitatively driven index that selects 30 US networking companies it believes will outperform. It weights them in tiers.

The iShares S&P North American Technology-Software ETF (IGV) invests 0.07% of its holdings in Barracuda. IGV tracks a market-cap-weighted index of US and Canadian software companies.

Comparing Barracuda and its ETFs

  • The YTD (year-to-date) price movements of Barracuda Networks, HACK, PXQ, and IGV are -34.29%, -3.85%, -3.29%, and 1.38%, respectively.

As a result, the ETFs outperformed Barracuda Networks based on the price movement.

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