Check Point Software Technologies Ltd (CHKP) Stock Analysis and Metrics

Sector: Technology Industry: Software - Infrastructure CIK: 0001015922

P/B 6.59

P/E 20.08

P/S 7.56

Market Cap 20.28 Bn

ROIC (Qtr) 45.39

Div Yield % 0.00

Rev 1y % (Qtr) 6.68

Total Debt (Qtr) 0.00

Debt/Equity (Qtr) 0.00

About

Check Point Software Technologies Ltd (CHKP) is a prominent player in the cybersecurity industry, providing security solutions for various types of organizations across 88 countries. The company's main business activities involve delivering collaborative security across an organization's security architecture, including the network, cloud, and workspace. Check Point's product and service offerings are designed to provide threat prevention, detection, and response capabilities. Check Point's revenue is generated primarily through its comprehensive...

Check Point Software Technologies Ltd (CHKP) is a prominent player in the cybersecurity industry, providing security solutions for various types of organizations across 88 countries. The company's main business activities involve delivering collaborative security across an organization's security architecture, including the network, cloud, and workspace. Check Point's product and service offerings are designed to provide threat prevention, detection, and response capabilities.

Check Point's revenue is generated primarily through its comprehensive enterprise-grade security solutions. These solutions are offered through its various product lines, including Quantum, Harmony, and CloudGuard. The Quantum product line provides comprehensive security solutions for data centers, networks, and cloud environments, catering to the needs of large enterprises and service providers. The Harmony product line provides endpoint and secure connectivity solutions for remote users, while the CloudGuard product line provides cloud-native security solutions for cloud workloads and applications.

Check Point operates in a highly competitive market, with key competitors such as Palo Alto Networks, Cisco Systems, and Fortinet. However, the company has a strong track record of innovation and has been recognized by various industry analysts and research firms for its leadership position in the cybersecurity market.

The Infinity Platform, Check Point's comprehensive, consolidated, and collaborative security platform, provides a unified security management platform for efficient security operations. The platform includes various solutions such as Quantum, Harmony, and CloudGuard, which provide advanced threat prevention, detection, and response capabilities.

Check Point's customer base includes organizations of all sizes and industries. The company has a global presence, with a significant presence in the United States, Israel, and other countries around the world. It has a diverse workforce of over 3,000 employees and subcontractors, with a majority of them dedicated to sales and marketing support.

In terms of environmental, social, and governance (ESG) practices, Check Point is committed to making the world a safer and more secure place, both on the internet and in the physical world. The company has set out various practices and guidelines, including its Corporate Responsibility Policy, Social Investment and Volunteer Statement, Human Resources Policy, and Workforce Diversity and Equality Statement, among others.

Check Point's product and service offerings include:

* Quantum, which provides comprehensive security solutions for data centers, networks, and cloud environments.
* Harmony, which provides endpoint and secure connectivity solutions for remote users.
* CloudGuard, which provides cloud-native security solutions for cloud workloads and applications.
* Infinity Platform, which provides a unified security management platform for efficient security operations.

Stock Price Chart

Analysis

Pros

Robust free cash flow of 1.13B exceeds capital expenditure of 25.90M by 43.69x, indicating strong organic growth funding capability.
Robust tangible asset base of 3.77B provides 11.84x coverage of working capital 318.50M, indicating strong operational backing.
Long-term investments of 1.35B provide solid 4.23x backing of working capital 318.50M, showing strategic capital allocation.
Operating cash flow of 1.16B provides solid 0.68x coverage of current liabilities 1.71B, showing strong operational health.
Retained earnings of 14.77B provide strong 8.85x coverage of other current liabilities 1.67B, indicating earnings quality.

Cons

Investment activities of 34.40M provide weak support for R&D spending of 433.50M, which is 0.08x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
Operating cash flow of 1.16B provides insufficient coverage of deferred revenue obligations of 1.89B, which is 0.61x, raising concerns about future service delivery capabilities.
Operating cash flow of 1.16B provides minimal -23.92x coverage of tax expenses of (48.40M), suggesting potential tax planning inefficiencies or unsustainable tax positions.
Long-term investments of 1.35B represent a high 16.22x of fixed assets 83.10M, indicating potential overexposure to financial assets versus operational capabilities.
Tax assets of 62.40M provide limited offset against tax liabilities of 304.70M, which is 0.20x, indicating potential future cash flow pressure from tax obligations.

Peer Comparison

Companies in the Software - Infrastructure

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	MSFT	Microsoft Corp	3,542.10 Bn	33.76	12.06	60.56 Bn
2	ORCL	Oracle Corp	533.93 Bn	34.61	8.75	124.39 Bn
3	PLTR	Palantir Technologies Inc.	437.56 Bn	399.47	112.31	0.24 Bn
4	PANW	Palo Alto Networks Inc	125.16 Bn	112.03	13.10	0.35 Bn
5	CRWD	CrowdStrike Holdings, Inc.	120.85 Bn	-384.67	26.47	0.82 Bn
6	SNPS	Synopsys Inc	71.69 Bn	35.89	11.14	15.14 Bn
7	NET	Cloudflare, Inc.	67.84 Bn	-658.43	33.70	3.50 Bn
8	FTNT	Fortinet, Inc.	63.33 Bn	33.80	9.66	1.00 Bn

Industry Comparisons

Current Valuation

Metric	Value	Industry
EV to Assets	3.45	2.56
EV to Cash from Ops.	16.99	38.32
EV to Debt	0.00	-11.37
EV to EBIT	20.46	-12.79
EV to EBITDA	20.64	7.72
EV to Free Cash Flow [EV/FCF]	17.38	24.22
EV to Market Cap	0.97	0.58
EV to Revenue	7.33	-35.00
Price to Book Value [P/B]	6.59	3.74
Price to Earnings [P/E]	20.08	-18.61

Dividend Metrics

Metric	Value	Industry	Percentile
Dividend Coverage Ratio	0.00	-0.30
Dividend Payout Ratio %	0.00	2.69
Dividend per Basic Share	0.00	0.10
FCF Dividend Payout Ratio %	0.00	1.67
Interest Coverage	0.00	-13.15

Growth Metrics

Metric	Value	Industry
Capex Growth (1y) %	-15.62	-404.11
Cash and Equivalents Growth (1y) %	13.99	226.02
Dividend Growth (1y) %	0.00	-0.27
EBIAT Growth (1y) %	20.60	31.15
EBITDA Growth (1y) %	0.24	49.02
EBIT Growth (1y) %	-0.21	25.85
EBT Growth (1y) %	-0.21	17.82
EPS Growth (1y) %	25.60	70.69
FCF Growth (1y) %	10.68	295.45
Gross Profit Growth (1y) %	5.23	49.96

Liquidity Ratios

Metric	Value	Industry
Asset Utilization Ratio	0.47	0.68
Cash Payout Ratio	0.00	0.02
Cash Ratio	0.36	1.21
Current Ratio	1.19	2.57
Debt to Equity Ratio	0.00	-0.93
Interest Cover Ratio	0.00	-13.15
Times Interest Earned	0.00	-13.15

Profitability

Metric	Value	Industry
EBITDA Margin %	39.60	-544.82
EBIT Margin %	35.82	-197.78
EBT Margin %	35.82	-602.74
Gross Margin %	86.80	52.06
Net Profit Margin %	37.60	-605.52

Check Point Software Technologies Ltd (NASDAQ: CHKP)