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Thu, Jan. 28, 11:53 AM
- Though the company used the occasion to affirm its Q4 sales/EPS guidance, Qualys (NASDAQ:QLYS) has tumbled below $25 after announcing yesterday afternoon CFO Don McCauley plans to step down on March 1 following roughly 10 years in the role.
- Shares have made new 52-week lows ahead of Feb. 8's Q4 report. Qualys now trades for 4.2x a 2016 sales consensus of $202.2M.
Dec. 10, 2015, 12:37 PM
- While giving privileged account software leader CyberArk a two-notch upgrade to Overweight, JPMorgan's Sterling Auty has downgraded cloud security/compliance software vendor Qualys (NASDAQ:QLYS) to Underweight, and set a $37 target.
- Auty reports an IT security spending survey found only 21% of respondents stating they're focusing on vulnerability management (a core offering for Qualys) in 2016, down from 32% in 2015. He also believes competition is intensifying from Rapid7 (RPD +3.2%), which went public earlier this year and takes an analytics-driven approach to detecting security vulnerabilities, as well as private firms.
- Last month, Qualys provided light Q4 sales guidance to go with a Q3 beat. Shares are now down slightly on the year.
Nov. 4, 2015, 6:54 PM
- CyberArk (NASDAQ:CYBR) is down 1.4% after hours, Qualys (NASDAQ:QLYS) is down 3.5%, and Rapid7 (NASDAQ:RPD) is down 2.2% after FireEye missed Q3 revenue and billings estimates (while beating on EPS), guided Q4 revenue below consensus, and cut its full-year billings guidance. Palo Alto Networks (previously covered) is also off.
- The malware and endpoint-protection hardware/software/services firm blamed weak European sales, which in turn were attributed to macro issues and "the growing pains of a new organization." Going into earnings, multiple analysts had raised concerns about growing competition from the likes of Cisco and Palo Alto.
- CyberArk reports Thursday afternoon, and Rapid7 on Nov. 12. Qualys sold off yesterday after providing soft Q4 guidance to go with a Q3 beat.
Nov. 3, 2015, 9:31 AM
- Though it beat Q3 estimates, Qualys (NASDAQ:QLYS) is guiding for Q4 revenue of $44.3M-$44.8M (+22% Y/Y at the midpoint), below a consensus of $45.7M. EPS guidance of $0.16-$0.18 is above a $0.12 consensus.
- When asked about the outlook on the earnings call (transcript), CFO Don McCauley noted growth for newer cloud-based offerings such as Web app scanning, policy compliance, and Web app firewalls had slowed to ~40% Y/Y from a prior 50%+, while Qualys' core vulnerability management (VM) offerings continued growing at 19%.
- McCauley insisted competition wasn't responsible. "[I]t's more the fact that today we are doing bigger upsells, so the timing of these upsells affect, obviously, the growth within the quarter. We're doing between $250,000 to even $1 million upsell now on Policy Compliance and on our Web Application Scanning. So the timing of those when they arrive in the quarter, obviously, can have an impact."
- The deferred revenue balance rose 22% Y/Y in Q3 to $101.8M. Gross margin (non-GAAP) rose to 80% from 79% a year ago; GAAP operating expenses rose 15% to $26.8M. Free cash flow for the first 9 months of the year rose 82% Y/Y to $26.7M.
- Q3 results, PR
- Update (3:28PM ET): Qualys has erased nearly all of its losses: Shares are now down 0.6%.
Nov. 2, 2015, 5:33 PM
Oct. 21, 2015, 12:34 PM
- Several security tech plays, including ones that were tech sector darlings earlier this year as a torrent of hacking incidents led corporate cybersecurity spend to jump, are selling off on a quiet day for equities.
- Major decliners include Palo Alto Networks (PANW -4%), FireEye (FEYE -4.9%), Fortinet (FTNT -4.3%), CyberArk (CYBR -4.8%), Imperva (IMPV -5.3%), Proofpoint (PFPT -3.9%), Qualys (QLYS -2.8%), and Rapid7 (RPD -6.8%).
- No major news has arrived to trigger a selloff. Meanwhile, hacking-related stories have continued producing ink in recent weeks. Notable ones: China is reportedly continuing hacking attacks on U.S. firms in spite of a pact that banned government spying on companies; authorities are probing a potential Russian hack of Dow Jones; and ISIS has reportedly tried (without much success) to hack the U.S. electrical grid.
- The PureFunds ISE Cyber Security ETF (HACK -1.6%) is down 24% from a June peak of $33.91. YTD, it's only down modestly.
- Proofpoint reports earnings after the close, and Fortinet tomorrow afternoon. Qualys reports on Nov. 2, FireEye on Nov. 4,, CyberArk on Nov. 5,, and Rapid7 on Nov. 12,
- Update: One potential culprit: Server virtualization software leader VMware is cratering due to its soft Q4/2016 guidance (partly blamed on cloud adoption). A smattering of other high-beta enterprise tech names are also selling off.
Oct. 8, 2015, 2:02 PM
- "Qualys (NASDAQ:QLYS) guided to a meaningful uplift in the company's target operating model as compared with both past guidance and current buy- or sell-side expectations," reports Credit Suisse's Philip Winslow after attending the cloud security/compliance software vendor's investor day. He has upgraded to Outperform, and hiked his target by $10 to $45.
- Winslow notes management's new 5-year plan aims for a 42%-46% op. margin and revenue of "at least" $500M. He estimates that respectively implies revenue and expense CAGRs of 24.7% and 15.8%-17.4%.
- Also: Winslow believes Qualys could be an attractive buyout target given its relatively low valuation, and (with 40% of clients still only using one product) sees ample cross-selling opportunities. New product launches are expected for the core QualysGuard cloud platform.
- Yesterday: Qualys names field operations chief, announces partnerships ahead of investor day
Aug. 20, 2015, 12:09 PM
- With investors fleeing to safety and asking questions later - Chinese macro concerns have been playing a role - tech stocks with high betas (and sometimes also high multiples and big 2014/2015 gains) are among the biggest losers as the S&P drops 1.1%, and the Nasdaq 1.7%.
- Noteworthy decliners include action camera leader GoPro (GPRO -6%), security tech plays Palo Alto Networks (PANW -4.9%), FireEye (FEYE -4.5%), CyberArk (CYBR -5.7%), Qualys (QLYS -5.1%), Imperva (IMPV -6%), and Vasco (VDSI -4.2%), and driver-assistance tech leader Mobileye (MBLY -6%).
- Others include optical networking hardware vendors Ciena (CIEN -5%) and Infinera (INFN -7.3%), optical component vendors NeoPhotnics (NPTN -5.9%) and Oclaro (OCLR -6.7%), data management software firm Varonis (VRNS -5.5%), programmatic ad-buying platform Rocket Fuel (FUEL -7.4%), DNS/IP address hardware vendor Infoblox (BLOX -5.1%), haptic tech developer Immersion (IMMR -6.2%), and solar microinverter maker Enphase (ENPH -7.2%).
- Many Chinese tech stocks are also seeing heavy losses.
Aug. 6, 2015, 2:54 PM| Aug. 6, 2015, 2:54 PM
Jul. 23, 2015, 11:27 AM
- As was the case 3 months ago, security tech plays are up strongly (HACK +3.6%) after Fortinet (FTNT +12%) beat estimates, reported strong billings, and delivered above-consensus top-line guidance. The Nasdaq is up 0.3%.
- In addition to FireEye, Palo Alto Networks, and CyberArk (previously covered), gainers include Barracuda Networks (CUDA +6.4%), KEYW Holding (KEYW +4.5%), Symantec (SYMC +1.9%), Imperva (IMPV +7.6%), Proofpoint (PFPT +3.6%), Vasco (VDSI +4.5%), AVG (AVG +3.1%), and Qualys (QLYS +5.7%). AVG is benefiting a bullish JPMorgan coverage launch; Proofpoint reports after the close.
- JPMorgan's Sterling Auty has upgraded Fortinet to Overweight, and a slew of firms have hiked their targets. Auty argues Fortinet's numbers suggest its efforts to grow its high-end presence (aided by major sales investments in recent years), and forecasts free cash flow will rise 43% this year.
- On Fortinet's earnings call (transcript), CFO Drew Del Matto mentioned $100K+ deals rose 53% Y/Y and $1M+ deal 133% (compares with 40% total billings growth). He also mentioned the company's high-end FortiGate UTM/next-gen firewall appliances made up 45% of billings (a new high), and that U.S. enterprise sales (benefiting from strong cybersecurity spend) rose 90%. Major deals were struck with "two of the most recognizable technology brands in the world," as well as two large i-banks.
Jun. 24, 2015, 11:54 AM
- Baird has downgraded Fortinet in response to a healthy 2015 run-up, and many security tech peers have joined the company in seeing profit-taking (HACK -1.3%). The Nasdaq is down just 0.1%.
- Decliners include FireEye (FEYE -2.3%), Qualys (QLYS -6.7%), KEYW (KEYW -5.1%), Check Point (CHKP -1.9%), Barracuda (CUDA -2.5%), Vasco (VDSI -2.5%), and Proofpoint (PFPT -1.8%). UBS downgraded FireEye to Neutral two days ago while citing valuation, and also cut Symantec to Sell. RBC has hiked its Qualys target by $6 to $44 today, while reiterating a Sector Perform.
- The selloff comes as an Office of Personnel Management (OPM) official states up to 18M Social Security numbers may have been stolen in a recent breach. FireEye recently ID'd a Chinese group it believes was responsible for the hack.
- Meanwhile, the WSJ has published a column about Check Point's efforts to expand beyond its core firewall market, and thereby keep the likes of Fortinet and Palo Alto Networks at bay. Gartner estimates Check Point had a 22.7% 2014 firewall share, well above #2 Cisco's (NASDAQ:CSCO) 15.9% but down from a 2013 share of 24%.
Jun. 15, 2015, 3:42 PM
- Though the Nasdaq is down 0.4%, security tech plays CyberArk (CYBR +7%), FireEye (FEYE +2.6%), Proofpoint (PFPT +4.1%), Zix (ZIXI +2.8%), Vasco (VDSI +5.7%), and Qualys (QLYS +4.7%) are turning in strong days. All of the names except for Proofpoint and Qualys have made new 52-week highs ... and Proofpoint is less than a dollar away from doing so.
- No major news is propelling the gains, but the massive federal personnel records hack first disclosed on June 4 continues to get plenty of media and political attention. Meanwhile, Russia's Kaspersky Lab has reported hackers used an updated version of the Duqu virus (linked to Israel) and a digital certificate from contract manufacturer Foxconn to spy on Iranian nuclear talks.
- ETF: HACK
Jun. 3, 2015, 6:39 PM
- The PureFunds ISE Cyber Security ETF (NYSEARCA:HACK) rose 2.5% today to $31.13, making new highs in the process. The media attention given to a Tuesday Senate hearing about a recent IRS breach, along with the IRS' promise to upgrade its security systems in response, may have helped.
- Major security tech gainers included KEYW Holding (KEYW +7.6%) and Vasco (VDSI +5.4%), each of whom have healthy government exposure. Others included Qualys (QLYS +3.8%), AVG (AVG +3.5%), Imperva (IMPV +3.3%), and Proofpoint (PFPT +2.9%).
- After the bell, FireEye announced a partnership with Visa to provide a joint threat-intelligence service to Visa merchants and card issuers.
May 26, 2015, 12:15 PM
- Believing the company's huge post-earnings selloff (caused by soft guidance) is overdone, Summit Research's Srini Nandury has launched coverage on Qualys (QLYS +1.7%) with a Buy rating and $50 target.
- Nandury: "Qualys is the clear industry leader in Vulnerability Management (VM) and is growing faster (although the growth slowed in F1Q with stock slumping) than the market and gaining share from legacy VM vendors (McAfee)." The firm also highlights Qualys' efforts to expand into adjacent markets such as policy compliance software (9% of revenue). "New and impending product offerings will increase TAM and provide years of growth for the company."
- Shares are higher in spite of a 1.1% drop for the Nasdaq. They're still down 27% from where they traded going into earnings on May 4.
May 5, 2015, 12:46 PM
May 5, 2015, 10:32 AM
- Though Qualys (QLYS -28.8%) beat Q1 EPS estimates and only slightly missed on revenue, it's guiding for Q2 revenue of $39.5M-$40M and EPS of $0.09-$0.11, below a consensus of $40.7M and $0.13. Full-year guidance is for revenue of $165M-$166.5M and EPS of $0.50-$0.55 vs. a consensus of $168.4M and $0.53.
- Security tech peers are underperforming (HACK -2.9%) amid a 0.8% drop for the Nasdaq. Decliners include CyberArk (CYBR -3.6%), FireEye (FEYE -2.5%), Palo Alto Networks (PANW -2.9%), Proofpoint (PFPT -3.8%), and AVG (AVG -2.3%).
- Discussing its light full-year outlook, Qualys says it now expects "a lower growth rate for our Vulnerability Management business than we did at the beginning of 2015" The growth rate for other products is said to be unchanged.
- On the CC (transcript), Qualys noted Vulnerability Management (provides cloud-based tools for detecting and fixing IT vulnerabilities) still accounts for nearly 80% of revenue, and that business' Y/Y sales growth slipped to 19% in Q1 from 20% in Q4 thanks to "the timing of a few large enterprise deals." With shares up over 3x from their 52-week lows going into earnings, there was little margin for error.
- Baird has gone contrarian and upgraded Qualys to Outperform following the rout. Baird, which maintains a $50 target, sees new products/services will boost growth. Qualys launched a cloud-based IT asset monitoring service last month, as well as a service for securing Web apps.
- FireEye and CyberArk are giving back some of the big Friday gains seen following FireEye's Q1 beat and full-year guidance hike.
Qualys Inc provides cloud security & compliance solutions to organizations identifying security risks to their IT infrastructures, to protect their IT systems from cyber-attacks & achieve compliance with internal policies & external regulations.
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