Goldman Sachs: CyberArk Could Be Getting More Government Support

Cyberark Software Ltd CYBR announced on March 29 that it has been awarded the “UC APL” (Unified Capabilities Approved Products List) certification by the Department of Defense (DoD).

Goldman Sachs’ Gabriela Borges reiterated a Buy rating on the company, with a price target of $51.

What Certification Means

Borges believes that the “UC APL” certification “makes it significantly easier for CyberArk to compete for DoD business.”

The analyst mentioned that there were thirteen security companies on the Approved Products List in the categories of Information Architecture and Network Access Control. Among these companies, CyberArk and Xceedium were the only two to offer privileged account solutions.

Borges also pointed out that the company was “executing well on increasing its penetration in federal. The UC APL certification follows CyberArk’s “Common Criteria” certification in July 2015.”

Growth Opportunities

The Federal segment accounted for 7 percent of the company’s sales in FY15, which the analyst expects to be a key growth opportunity for CyberArk.

Federal represents ~7% of sales in FY15 (larger security companies have 10% - 15% exposure), and we believe this is a key growth opportunity.

With meaningful greenfield adoption momentum being seen across various industry verticals through 2014 and 2015, Borges believes that the U.S. government “is increasing its focus on identity access management, and privileged account management in particular.”