FBN Securities Raises PT on Check Point Software to $70

FBN Securities has published a research report on Check Point Software (NASDAQ: CHKP) and has raised the price target from $65 to $70 after the company reported its strong quarter results.

In the report, FBN Securities writes, " The company just reported a strong quarter with bookings growth of 18%, and it has had good reception to its new products (61000, 2140, 4000, etc.) introduced in early October 2011. Possible red flags, such as 1.) DSO at 90 days as A/R grew $160M, or 81% Q/Q) due to a back-end loaded quarter (FQ4 typically exhibits strong A/R growth), and 2.) guidance not materially better than consensus, are not too concerning. Our checks on CHKP suggest that growth of 10-13% in F2012 is achievable (we model 11.7% vs. company guidance of 8-12% and prior consensus of 10.7%). For the FQ4/Dec. quarter, CHKP reported revenue of $356.8M (up 12% Y/Y and in line with consensus of $355.5M) and NG EPS of $.84 (ahead of consensus of $.82). Deferred revenue of $552.2M grew 19% Y/Y and 22% Q/Q, resulting in strong total bookings of $454.5M (up 18% Y/Y). Net cash grew to $2.9M ($13.53/share, representing over a quarter of the share price) as the company generated $172M in free cash flow. Deals over $50K accounted for 65% of total order value, up from 63% in FQ3. CHKP had 49 customers with over $1M in transactions; this is up from 35 in FQ3 and 44 a year before. IPS continues to be the best-selling blade, followed by application control. In FH1 2012, it will introduce its Anti-Bot blade."

FBN Securities maintains its Outperform rating on Check Point Software, which is currently trading up $4.10 from Friday's $53.90 closing price.