Market Overview

Target On Proofpoint Shares Lifted From $85 To $100 Following Q4 Results


Proofpoint Inc (NASDAQ: PFPT) “continued to achieve strong growth and execution in 4Q16, exceeding our estimates and consensus, and management raised guidance for FY17,” Imperial Capital’s Michael Kim said in a note, while maintaining an Outperform rating on the company and raising the price target from $85 to $100.

Growth Outlook

The analyst expects Proofpoint to witness sustained growth, driven by ramping enterprise adoption of cloud applications and Office 365, as well as higher upselling and cross-selling of the company’s nice core product offerings.

Kim noted that exiting FY 2016, 50 percent of the company’s customers had purchased multiple products, with 24 percent customers using three or more products.

The analyst believes Proofpoint is “especially benefiting from escalating threats, such as Business Email Compromise, and expanding demand for social media security and compliance solutions, as evidenced by emerging products revenue more than doubling over the prior year quarter.”

Kim expects potential upside from new products, including advanced threat protection for Software-as-a-Service (SaaS) applications, international expansion, archiving transactions and transactions with ecosystem partners.

Q4 Results

For Q4 2016, Proofpoint reported revenue of $106.8 million, with adjusted EPS of $0.18, beating the consensus and the estimates.

Billings grew about 42 percent year-on-year to $138 million, beating the guidance, while the company continued to drive robust growth from new customers and increased penetration of its installed base.

The company also expanded its customer base for its innovative anti-phishing solution, Targeted Attack Penetration (TAP), the analyst added.

Latest Ratings for PFPT

Nov 2019Initiates Coverage OnOverweight
Oct 2019MaintainsOutperform
Oct 2019MaintainsOverweight

View More Analyst Ratings for PFPT
View the Latest Analyst Ratings

Posted-In: imperial capital Michael KimAnalyst Color Long Ideas Price Target Analyst Ratings Trading Ideas


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