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What's in the Offing for Check Point (CHKP) in Q3 Earnings?

Check Point Software Technologies CHKP is set to report third-quarter 2022 results on Oct 27.

For the third quarter, Check Point projects revenues between $555 million and $585 million ($570 million at the midpoint). The Zacks Consensus Estimate for revenues is pegged at $572.2 million, suggesting a 7.1% increase from the year-ago quarter’s reported figure.

Additionally, CHKP forecasts adjusted earnings per share in the range of $1.60-$1.72 ($1.66 at the midpoint). The consensus mark for earnings stands at $1.67 per share, a couple of cents higher than the year-ago quarter’s earnings of $1.65.

Let’s see how things have shaped up before this announcement.

Check Point Software Technologies Ltd. Price and EPS Surprise

Check Point Software Technologies Ltd. Price and EPS Surprise
Check Point Software Technologies Ltd. Price and EPS Surprise

Check Point Software Technologies Ltd. price-eps-surprise | Check Point Software Technologies Ltd. Quote

Factors to Note Ahead of Q3 Earnings

The hybrid work environment has urged the greater need for network security. This trend is anticipated to have fueled the demand for Check Point’s products during the quarter under review.

Moreover, the increased demand for network security gateways to support higher capacities amid the hybrid work environment is expected to have spurred the demand for CHKP’s remote access VPN (virtual private network) solutions.

Additionally, Check Point’s quarterly performance is likely to have benefited from increased security subscriptions due to the solid demand for its CloudGuard, Harmony, Sandblast Zero-day threat prevention and Infinity solutions.

However, the weakening global economy amid ongoing macroeconomic and geopolitical issues led enterprises to postpone their large IT spending plans. This might have hurt Check Point’s top line in the third quarter. Additionally, the firm’s elevated investments in sales and marketing efforts might have clipped margins during the quarter to be reported.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Check Point this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that’s not the case here.

Check Point currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Per our model, Fortinet FTNT, Twilio TWLO and CDW Corporation CDW have the right combination of elements to post an earnings beat in their upcoming releases.

Fortinet is slated to report third-quarter 2022 results on Nov 2. The company carries a Zacks Rank #2 and has an Earnings ESP of +0.92% at present. Fortinet’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 10.3%. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for quarterly earnings is pegged at 27 cents per share, suggesting a year-over-year improvement of 35%. FTNT’s quarterly revenues are estimated to increase 29.6% year over year to $1.12 billion.

Twilio currently carries a Zacks Rank #2 and has an Earnings ESP of +1.94%. The company is slated to report its third-quarter 2022 results on Nov 3. Twilio’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 64.1%.

The Zacks Consensus Estimate for Twilio’s third-quarter earnings stands at a loss of 39 cents per share. TWLO is estimated to report revenues of $969.2 million, which suggests growth of 30.9% from the year-ago quarter.

CDW carries a Zacks Rank #3 and has an Earnings ESP of +0.31%. The company is scheduled to report third-quarter 2022 results on Nov 2. CDW’s earnings surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 6.8%.

The Zacks Consensus Estimate for CDW’s third-quarter earnings is pegged at $2.52 per share, indicating a year-over-year increase of 18.3%. The consensus mark for revenues stands at $6.21 billion, suggesting a year-over-year increase of 17.2%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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Check Point Software Technologies Ltd. (CHKP) : Free Stock Analysis Report
 
Fortinet, Inc. (FTNT) : Free Stock Analysis Report
 
CDW Corporation (CDW) : Free Stock Analysis Report
 
Twilio Inc. (TWLO) : Free Stock Analysis Report
 
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