Proofpoint - The Proof Is Lacking In The Pudding
Market Mirage • 12 Comments
Market Mirage • 12 Comments
Proofpoint: One Of My Favorite Shorts
Amit Ghate • 10 Comments
Amit Ghate • 10 Comments
Fri, Jul. 22, 9:21 AM
- Proofpoint (NASDAQ:PFPT) reported Q2 results yesterday after market close and exceeded estimates by posting EPS of $0.06, beating by $0.13, and revenue of $89.9M (+41% Y/Y) vs. estimates of $84.22M.
- Billings of $101.2M (+34% Y/Y).
- Raises guidance across FY16 billings, revenue, profitability and cash flow.
- GAAP operating loss of $32M vs. $19.1M Y/Y, citing $13.5M in expenses resulting from patent litigation.
- GAAP net income loss of $38.3M vs. $22.6M Y/Y.
- Adjusted EBITDA of $7.7M vs. $2.8M Y/Y.
- Free cash flow about even Y/Y.
- Q3 guidance for revenue of $93.5M-$94.5M, billings of $114M-$116M, adjusted EBITDA of $7.4M-$7.9M, non-GAAP EPS of $0.04-$0.06 and free cash flow of $8M-$10M.
- FY16 guidance for revenue of $361.5M-$363.5M, billings of $445M-$448, adjusted EBITDA of $24.5M-$25.5M, non-GAAP EPS of $0.06-$0.10 and free cash flow of $34M-$38M assuming $31M-$33M in capital expenditures.
Fri, Jul. 22, 9:11 AM
Thu, Jul. 21, 5:34 PM
Thu, Jul. 21, 4:08 PM
Wed, Jul. 20, 5:35 PM
Wed, Jun. 8, 3:51 PM
- Finjan (FNJN +13.9%) has settled its infringement suit against security software firm Proofpoint (PFPT +1.6%). As part of the deal, Finjan will receive $10.9M in cash via three payments: A $4.3M up-front payment, a $3.3M payment due on or before Jan. 4, 2017, and a $3.3M payment due on or before Jan. 3, 2018. Other deal terms are confidential.
- With Finjan sporting a $35M market cap going into day, shares have soared on the news. The company has also sued a number of other security tech firms. A $39.5M jury award was obtained last year in a suit against security hardware/software provider Blue Coat.
Fri, May 6, 2:17 PM
- Palo Alto Networks (PANW -3.7%), Proofpoint (PFPT -3.6%), Rapid7 (RPD -2.1%), Identiv (INVE -7.5%), and Vasco (VDSI -3.1%) are selling off after security tech peers FireEye (down 18.8%), Imperva (down 25.2%), and CyberArk (up 1.5%) delivered their Q1 reports.
- FireEye, likely the biggest culprit behind the selloff, posted mixed Q1 results (sales missed, EPS beat), offered light Q2 and full-year revenue guidance (full-year billings guidance was affirmed), and announced (as part of a larger management shakeup) Kevin Mandia is replacing Dave DeWalt as CEO. The company's product (hardware/software) revenue fell 16% Y/Y amid tough competition in the malware-prevention space from Palo Alto and Cisco - Palo Alto's WildFire malware-detection service has been growing like its name - while its services/subscription revenue grew 58% thanks to both organic growth and M&A.
- Imperva beat Q1 EPS estimates and posted roughly in-line revenue, but offered soft Q2 sales guidance blamed on European execution and (to some extent) web app firewall weakness. The company promises it's fixing both issues.
- CyberArk beat Q1 estimates and offered Q2/2016 guidance that was generally favorable to consensus. The company's license revenue growth slightly accelerated in Q1 to 38% from Q4's 35%.
- The PureFunds ISE Cyber Security ETF (HACK -2.3%) is down 13% YTD.
Sun, Apr. 24, 6:13 PM
- via Credit Suisse, in order of # of small-cap funds who own the stock. Following the stock is the number of funds who own it, and the change vs. previous quarter:
- IDTI - Integrated Device Tech 96 | 14
- MSCC - Microsemi 86 | 10
- MANH - Manhattan Associates 85 | 5
- CBM - Cambrex 80 | 4
- EEFT - Euronet Worldwide 80 | 8
- POR - Portland General Electric 79 | 0
- EME - Emcore 78 | 6
- LAD - Lithia Motors 78 | 6
- AMSG - Amsurg 78 | 0
- JCOM - J2 Global 77 | 4
- PFPT - Proofpoint 77 | 4
- AHS - AMN Healthcare 74 | 2
- EXPR - Express Inc. 74 | 3
- ICUI - ICU Medical 73 | 0
- LGND - Ligand Pharma 73 | 6
- PVTB - Privatebancorp 73 | -2
- PRXL - Parexel 72 | 5
- AEL - Americal Equity Investment Life 71 | 3
- TYL - Tyler Technologies 71 | 7
- CRZO - Carrizo Oil & Gas 69 | 3
- MENT - Mentor Graphics 69 | -9
- MNRO - Monro Muffler Brake 68 | 0
- WAL - Western Alliance Bancorp 68 | 8
- AEO - American Eagle Outfitters 67 | 0
- LOGM - Logmein 67 | -1
- OZRK - Bank of the Ozarks 67 | 5
- SHOO - Steven Madden 67 | -10
- STE - Steris 67 | 20
- WNC - Wabash National 67 | -1
- Credit Suisse recommends reducing exposure in small-cap "darlings" due to less opportunity for differentiation; historical underperformance; and outflows.
Thu, Apr. 21, 4:09 PM
Wed, Apr. 20, 5:35 PM
Mon, Feb. 8, 2:37 PM
- Many tech stocks are seeing 6%+ losses as investors flee to safety yet again. The Nasdaq is down 3.4%, and the S&P 2.7%.
- As was the case on Friday following Tableau and LinkedIn's disappointing guidance, a slew of enterprise tech stocks are seeing big losses, with cloud software and security tech names well-represented on the casualty list.
- Also: Solar stocks are having another brutal day (TAN -6.7%) as energy stocks get routed amid fears Chesapeake Energy is close to bankruptcy. WTI crude oil is once more near $30/barrel.
- Enterprise software decliners: Adobe (ADBE -9.6%), Paylocity (PCTY -19.1%), Salesforce (CRM -9.9%), Workday (WDAY -12%), Guidewire (GWRE -12.5%), ServiceNow (NOW -11.5%), Zendesk (ZEN -13.8%), Paycom (PAYC -13.4%), Marin Software (MRIN -10.3%), Castlight (CSLT -8.4%), Cornerstone OnDemand (CSOD -12.1%), Atlassian (TEAM -13.2%), inContact (SAAS -9.6%), and Bazaarvoice (BV -14.5%).
- Enterprise security decliners: Palo Alto Networks (PANW -12.2%), FireEye (FEYE -9.8%), CyberArk (CYBR -11.5%), Proofpoint (PFPT -12.7%), Qualys (QLYS -8.9%), Imperva (IMPV -9.7%), Rapid7 (RPD -9.4%), and Barracuda (CUDA -8.4%).
- Solar decliners: SunEdison (SUNE -11.3%), SunPower (SPWR -8.8%), JinkoSolar (JKS -7.6%), SolarEdge (SEDG -7.9%), Yingli (YGE -7.1%), TerraForm Power (TERP -10.7%), and TerraForm Global (GLBL -9.2%).
- Other major decliners: Micron (MU -9.1%), Western Digital (WDC -10.5%), Arista (ANET -10.9%), Universal Display (OLED -10.6%), Rackspace (RAX -11.3%), Fitbit (FIT -8.7%), Nimble Storage (NMBL -11.3%), Sierra Wireless (SWIR -9.9%), Rocket Fuel (FUEL -9.8%), Knowles (KN -9%), Mitel (MITL -8.9%), and Alarm.com (ALRM -8.9%).
- Previously covered: Yelp, Cognizant, Tableau, Globant, Ambarella, European tech stocks
Fri, Feb. 5, 11:01 AM
- A long list of enterprise software and security tech names are off sharply after business intelligence/analytics software upstart Tableau (down 45.3%) reported slower-than-expected license revenue growth and issued below-consensus Q1/2016 guidance.
- Also possibly weighing: LinkedIn (down 39.6%), which derives a large % of its revenue from cloud-based recruiting and sales tools for enterprises, issued weak Q1/2016 guidance.
- Given the magnitude of the drops, margin calls and forced selling by funds could be playing a big role. The Nasdaq is down 2.2%.
- Tableau suggested its growth slowdown has to do with softening IT spend and a need to improve sales productivity, but analysts have raised questions about competition from the likes of Microsoft, Amazon, and Qlik. LinkedIn forecast a growth slowdown for its field sales hiring solutions business, while blaming European/Asian macro pressures. The company also noted its display ad business continues declining amid weak industry growth.
- Major enterprise software decliners include Splunk (SPLK -23.7%), Workday (WDAY -15.1%), Adobe (ADBE -7%), Zendesk (ZEN -15.2%), ServiceNow (NOW -13.6%), NetSuite (N -12.4%), Salesforce (CRM -11.2%), Paycom (PAYC -10.6%), Ellie Mae (ELLI -11.5%), Cornerstone OnDemand (CSOD -7.8%), Veeva (VEEV -7.7%), Ultimate Software (ULTI -9%), Luxoft (LXFT -7.5%), Manhattan Associates (MANH -8.5%), Box (BOX -6.6%), Guidewire (GWRE -13.6%), Demandware (DWRE -9.3%), Hortonworks (HDP -9.7%), and Tableau rival Qlik (QLIK -16.6%). The casualty list includes many cloud software firms, as well as several analytics software plays. Previously covered: New Relic, Atlassian.
- Major decliners among security tech firms: Palo Alto Networks (PANW -12%), FireEye (FEYE -8.9%), Rapid7 (RPD -8.6%), CyberArk (CYBR -8.3%), Proofpoint (PFPT -8%), Imperva (IMPV -8.3%), Fortinet (FTNT -6.9%), and Vasco (VDSI -5.1%). The selloff comes in spite of an FQ3 beat and in-line FQ4 guidance from Symantec, which has been losing share to various upstarts.
Fri, Jan. 29, 5:10 PM
- Proofpoint (NASDAQ:PFPT) beat Q4 revenue estimates (while posting in-line EPS) and reported billings of $97.5M - up 30% Y/Y, above guidance of $90M-$92M, and well above revenue of $74.9M.
- However, both Proofpoint's Q1 and 2016 outlooks feature a mixture of soft EPS guidance and strong sales guidance. The company forecasts Q1 revenue of $75.5M-$76.5M and EPS of -$0.14 to -$0.15 vs. a consensus of $75.6M and -$0.09, and a 2016 revenue of $345M-$348M and EPS of -$0.21 to -$0.26 vs. a consensus of $343.2M and -$0.10. Q1 and 2016 billings guidance is respectively at $90M-$92M and $428M-$431M.
- Heavy spending is weighing on EPS: GAAP operating expenses rose 42% Y/Y to $76.1M - $45.2M was spent on sales/marketing, $20.1M on R&D, and $10.8M on G&A.
- "We continue to invest in new product development and expand our sales and marketing resources worldwide," said CFO Paul Anvil on the earnings call. He added Proofpoint doesn't expect to "deliver much, if any, improvement to our cash flow and profitability guidance over the course of the year," as it plans to reinvest any extra funds produced by revenue/billings upside.
- Proofpoint's Q4 results, earnings release
Thu, Jan. 28, 4:08 PM
- Proofpoint (NASDAQ:PFPT): Q4 EPS of -$0.11 in-line.
- Revenue of $74.9M (+33.3% Y/Y) beats by $1.44M.
Wed, Jan. 27, 5:35 PM| Wed, Jan. 27, 5:35 PM | 9 Comments
Thu, Jan. 21, 6:17 PM
- Though FireEye (NASDAQ:FEYE) opened up strongly after pre-announcing Q4 sales/billings and disclosing it's buying threat intelligence services firm iSIGHT for $200M+, shares closed down 0.5%. The cybersecurity hardware/software/services provider is down 29% in 2016, and 49% since its Nov. 4 Q3 report.
- Concerns about FireEye's 2016 commentary - in a PR quote, CEO Dave DeWalt said "we expect we can grow billings organically by 20 percent" in 2016 - appear to be weighing. Piper's Andrew Nowinski (target cut by $8 to $19) believes the Street billings growth consensus was at 28%. He now sees 26% total billings growth, after factoring $50M in expected iSIGHT billings.
- Meanwhile, FBN's Shebly Seyrafi sees FireEye's e-mail security offerings (have boosted subscription revenue) facing tough competition from a new alliance between Palo Alto Networks (NYSE:PANW) and Proofpoint (NASDAQ:PFPT). Palo Alto's WildFire malware-prevention service (competes with FireEye's malware-prevention offerings, and integrates with Palo Alto's next-gen firewalls) will be paired with Proofpoint's core Targeted Attack Protection e-mail security software to protect against e-mail and social media-based malware attacks. End-to-end network, cloud, and endpoint security is promised.
- On the bright side, reactions to the iSIGHT acquisition have been largely positive. Deutsche's Karl Keirstead: "We like this security segment and the deal rationale/economics seem reasonable." Stifel's Gul Talpaz: "In the near-term, we believe that feeding iSIGHT’s intelligence into FireEye’s existing products should improve their overall efficacy and reduce already low false-positive rates."