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Check Point (CHKP)
NASDAQ:CHKP
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Check Point
(NASDAQ:CHKP)
Rating:76Outperform
Price Target:
$211.00
▲(13.86% Upside)
Positive Factors
Market Confidence
Management highlighted that trends in July have been very strong, even after backing out slipped deals.
Product Growth
Newer product offerings such as email, ERM, and SASE grew above 40% YoY, displaying strong cross-sell abilities.
Strategic Initiatives
CHKP's strategic initiatives are driving platform adoption, positioning the company to reaccelerate growth.
Negative Factors
Billings Growth
Billings grew a disappointing 3.6%, yet management pointed to a few large deals that slipped into 3Q25 and impacted billings growth by 300bps, yet have already closed in July.
Financial Performance
CHKP reported soft FQ2 results and left the outlook for 2025 unchanged.
Investor Sentiment
Investors are frustrated by the slower pace of reacceleration and longer time frame required to implement effective changes.
Check Point (CHKP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$19.64B
Dividend YieldN/A
Average Volume (3M)1.01M
Price to Earnings (P/E)24.5
Beta (1Y)0.45
Revenue Growth6.27%
EPS Growth7.14%
CountryUS
Employees6,669
SectorTechnology
Sector Strength94
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)2.37
Shares Outstanding108,368,520
10 Day Avg. Volume1,315,784
30 Day Avg. Volume1,014,492
Financial Highlights & Ratios
PEG Ratio3.82
Price to Book (P/B)7.40
Price to Sales (P/S)8.05
P/FCF Ratio20.08
Enterprise Value/Market Cap1.17
Enterprise Value/Revenue8.79
Enterprise Value/Gross Profit10.12
Enterprise Value/Ebitda23.93
Forecast
1Y Price Target
$225.35Price Target Upside21.60% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering27
Check Point Business Overview & Revenue Model
Company DescriptionCheck Point Software Technologies Ltd. (CHKP) is a leading global provider of cybersecurity solutions, headquartered in Tel Aviv, Israel. The company specializes in network security, endpoint protection, cloud security, mobile security, data security, and security management. Known for its innovative approach, Check Point offers a comprehensive portfolio of products and services designed to protect businesses from cyber threats, including firewalls, VPNs, intrusion prevention systems, and advanced threat prevention solutions.
How the Company Makes MoneyCheck Point makes money primarily through the sale of its cybersecurity products and services. The company's revenue model includes software and hardware sales, subscription-based services, and support and maintenance contracts. Key revenue streams include product licenses, which provide businesses with access to Check Point's security software, and security subscriptions that offer ongoing protection and updates. Additionally, the company generates income from professional services, such as consulting and training. Strategic partnerships with technology vendors and channel partners also play a significant role in expanding Check Point's market reach and enhancing its distribution capabilities, contributing to its earnings.
Check Point Key Performance Indicators (KPIs)
Any
Revenue by Segment
Examines revenue from various business segments, indicating which areas drive growth and how diversified the company’s income streams are.
Examines revenue from various business segments, indicating which areas drive growth and how diversified the company’s income streams are.
Data provided by:
Main Street Data
Main Street DataCheck Point Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: -15.12%|
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong growth in AI-powered firewalls and strategic recognitions in the SASE market, alongside robust financial performance and cash flow. However, challenges included a slight decline in support revenues due to discounting, foreign exchange impacts, and timing issues with deal closures.Q2-2025 Updates
Positive Updates
Strong Quantum Force AI-Powered Firewall Growth
Quantum Force AI-powered firewalls posted a robust quarter, growing 12% year-over-year, driven by refresh momentum and increased demand for AI-powered inspection.
Inclusion in Gartner Magic Quadrant for SASE
Check Point's progress acknowledged with inclusion in the 2025 Gartner Magic Quadrant for SASE and recognition as a leader in the Forrester Wave for Zero Trust Platforms.
Healthy Revenue and EPS Growth
Revenues exceeded projections by $3 million, achieving $665 million with a non-GAAP EPS of $2.37, presenting a 9% growth year-over-year.
Strong Operating Cash Flow
Operating cash flow achieved $262 million, a 31% growth year-over-year.
Strong Performance in APAC Region
APAC saw double-digit growth, reaching 15% year-over-year growth this quarter.
Negative Updates
Slight Decline in Support Revenues
Slight decline in support revenues due to higher discount levels in bundled deals, leading to a de-acceleration in subscription revenues.
Impact of Foreign Exchange Rates
Currency movements resulted in a 0.5 point headwind to margins this quarter, with potential impacts on future operating expenses.
Back-End Loaded Quarter with Slip Deals
Several deals pushed from the last few days of the quarter to the first two weeks of July, affecting billing by approximately 3 points.
Company Guidance
During the call, Check Point Software Technologies provided guidance for their third quarter of 2025, maintaining their full-year guidance. They announced an anticipated revenue range of $657 million to $687 million for Q3, with a midpoint of $672 million. The expected non-GAAP EPS for the third quarter is between $2.40 and $2.50, with the GAAP EPS projected to be $0.68 less. Despite facing challenges such as deal slippage, which impacted Q2 billing by approximately 3 points, they closed these deals early in Q3. The company reaffirmed confidence in reaching the high end of their 2025 guidance, supported by strong indicators in July and a healthy pipeline for the remainder of the year. Check Point also emphasized continued investment in AI and product innovations, including a newly opened R&D center in India, which is contributing to their growth strategies alongside a focus on enhancing their go-to-market approach. Additionally, Check Point highlighted growth in their Quantum Force AI-powered firewalls, which grew 12% year-over-year, and substantial growth in SASE, e-mail, and ERM offerings, each growing over 40% year-over-year, reinforcing their strategic focus areas.Check Point Financial Statement Overview
Summary
Check Point demonstrates strong financial health with robust profit margins, efficient cash flow management, and a solid balance sheet. The company exhibits stable growth and profitability, with low financial risk due to minimal leverage.Income Statement
Check Point has shown consistent revenue growth, with a revenue growth rate of 6.23% in 2024 compared to 2023. The gross profit margin remains strong at approximately 88.51%, indicating efficient cost management. However, the slight decline in EBIT and EBITDA compared to 2023 suggests a need for monitoring operational efficiencies.85
Very Positive
Balance Sheet
The company maintains a strong balance sheet with a very low debt-to-equity ratio, reflecting minimal leverage risk. The equity ratio stands at 48.55%, indicating a solid equity position. Return on Equity remains robust at around 30.31%, showcasing effective use of shareholder funds.90
Very Positive
Cash Flow
Operating cash flow is robust, reflecting strong cash generation capabilities. The free cash flow to net income ratio is impressive, indicating efficient capital allocation. Although free cash flow growth has slowed compared to prior years, the overall cash position remains strong.88
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.60B | 2.56B | 2.41B | 2.33B | 2.17B | 2.06B |
| Gross Profit | 2.26B | 2.25B | 2.13B | 2.03B | 1.91B | 1.84B |
| EBITDA | 957.20M | 1.06B | 1.02B | 920.50M | 938.20M | 931.30M |
| Net Income | 852.70M | 845.70M | 840.30M | 796.90M | 815.60M | 846.60M |
Balance Sheet | ||||||
| Total Assets | 5.56B | 5.75B | 5.70B | 5.72B | 5.90B | 5.84B |
| Cash, Cash Equivalents and Short-Term Investments | 1.46B | 1.37B | 1.53B | 1.64B | 1.69B | 1.69B |
| Total Debt | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total Liabilities | 2.81B | 2.97B | 2.87B | 2.80B | 2.64B | 2.37B |
| Stockholders Equity | 2.75B | 2.79B | 2.82B | 2.93B | 3.26B | 3.47B |
Cash Flow | ||||||
| Free Cash Flow | 1.08B | 1.03B | 1.02B | 1.08B | 1.19B | 1.14B |
| Operating Cash Flow | 1.11B | 1.05B | 1.04B | 1.10B | 1.20B | 1.16B |
| Investing Cash Flow | -210.79M | -24.00M | 468.70M | -6.40M | -75.30M | -98.20M |
| Financing Cash Flow | -1.06B | -1.06B | -1.16B | -1.17B | -1.11B | -1.09B |
Check Point Technical Analysis
Negative
185.32
Price Trends
213.34
Negative
216.69
Negative
207.15
Negative
Market Momentum
-9.59
Positive
33.68
Neutral
37.98
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHKP, the sentiment is Negative. The current price of 185.32 is below the 20-day moving average (MA) of 199.89, below the 50-day MA of 213.34, and below the 200-day MA of 207.15, indicating a bearish trend. The MACD of -9.59 indicates Positive momentum. The RSI at 33.68 is Neutral, neither overbought nor oversold. The STOCH value of 37.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CHKP.
Check Point Risk Analysis
Check Point disclosed 36 risk factors in its most recent earnings report. Check Point reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Check Point Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $59.19B | 30.83 | 165.17% | ― | 14.46% | 48.06% | |
77 Outperform | $105.90B | 721.64 | -5.76% | ― | 25.94% | -226.80% | |
76 Outperform | $19.64B | 24.52 | 30.30% | ― | 6.27% | 7.14% | |
76 Outperform | $117.07B | 101.21 | 21.16% | ― | 13.91% | -50.96% | |
74 Outperform | $45.44B | 16.46 | 14.27% | ― | 1.41% | 262.31% | |
73 Outperform | $42.19B | ― | -2.68% | ― | 25.46% | 49.20% | |
61 Neutral | $36.26B | 7.13 | -7.27% | 1.97% | 7.78% | -8.61% |
* Technology Sector Average
Performance Comparison
CHKP
Check Point
185.32
-0.09
-0.05%
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CRWD
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424.86
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.