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Check Point Software (CHKP)
:CHKP
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Check Point
(NASDAQ:CHKP)
Select Model
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Rating:76Outperform
Price Target:
$211.00
▲(3.77% Upside)
Check Point's strong financial performance and positive earnings call sentiment are key strengths, contributing significantly to the score. However, bearish technical indicators and valuation concerns slightly offset the overall positive outlook.
Positive Factors
Strong Financial Health
Check Point's robust financial health, characterized by strong profit margins and efficient cash flow, ensures long-term stability and resilience against market fluctuations.
AI-Powered Product Growth
The growth in AI-powered firewalls highlights Check Point's innovation and strengthens its competitive position in the cybersecurity market.
Strategic Market Recognition
Recognition in industry reports enhances Check Point's credibility and market positioning, potentially driving future customer acquisition and retention.
Negative Factors
Decline in Support Revenues
A decline in support revenues due to discounting could impact long-term revenue stability and suggests potential pricing pressure in the market.
Foreign Exchange Impacts
Foreign exchange impacts can affect profitability and operational costs, posing a risk to margin sustainability in the long term.
Deal Closure Timing Issues
Timing issues with deal closures can lead to revenue recognition delays, affecting short-term financial performance and forecasting accuracy.
Check Point (CHKP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$22.04B
Dividend YieldN/A
Average Volume (3M)787.70K
Price to Earnings (P/E)26.5
Beta (1Y)0.48
Revenue Growth6.27%
EPS Growth7.14%
CountryUS
Employees6,669
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)2.37
Shares Outstanding108,368,520
10 Day Avg. Volume778,047
30 Day Avg. Volume787,696
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 Cap1.04
Enterprise Value/Revenue8.79
Enterprise Value/Gross Profit10.12
Enterprise Value/Ebitda23.93
Forecast
1Y Price Target
$225.00Price Target Upside10.65% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering26
Check Point Business Overview & Revenue Model
Company DescriptionCheck Point Software Technologies Ltd. develops, markets, and supports a range of products and services for IT security worldwide. The company offers a portfolio of network security, endpoint security, data security, and management solutions. It provides Check Point Infinity Architecture, a cyber security architecture that protects against 5th and 6th generation cyber-attacks across various networks, endpoint, cloud, workloads, Internet of Things, and mobile. The company also offers security gateways and software platforms that support small and medium sized business (SMB) to large enterprise data center and telco-grade environments; and threat prevention technologies and zero-day protections. In addition, the company provides cloud network security, security and posture management, cloud workload protection, and cloud web application protection for web applications and APIs; and Check Point Harmony that delivers endpoint and secure connectivity for remote user access. Further, the company provides technical customer support programs and plans; professional services in implementing, upgrading, and optimizing Check Point products comprising design planning and security implementation; and certification and educational training services on Check Point products. It sells its products through multiple distribution channels, including distributors, resellers, system integrators, original equipment manufacturers, and managed security service providers. Check Point Software Technologies Ltd. was incorporated in 1993 and is headquartered in Tel Aviv, Israel.
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: |
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted several positive achievements, including revenue and EPS in line with projections, growth in new product lines, and strong operating cash flow. However, there were challenges such as a back-end loaded quarter, slip deals, and currency fluctuations impacting margins. The company is also focusing on accelerating growth and addressing go-to-market challenges.Q2-2025 Updates
Positive Updates
Revenue and EPS in Line with Outlook
Check Point's revenue exceeded the midpoint of projections by $3 million, achieving $665 million, with non-GAAP EPS at $2.37, representing 9% growth year-over-year.
Quantum Force AI-Powered Firewalls Growth
Quantum Force AI-powered firewalls posted a robust quarter, growing 12% year-over-year, driven by refresh momentum and growing demand for AI-powered inspection.
Strong Demand for New Product Lines
New product lines such as email, SASE, and ERM are growing at over 40% year-over-year, showing healthy growth and contributing positively to the company's portfolio.
Inclusion in Gartner Magic Quadrant for SASE
Check Point's inclusion in the 2025 Gartner Magic Quadrant for SASE and recognition as a leader in the Forrester Wave for Zero Trust Platforms are notable achievements.
Strong Operating Cash Flow
The company achieved a strong operating cash flow of $262 million, a 31% growth year-over-year.
Negative Updates
Slight De-acceleration in Subscription and Support Revenues
The refresh cycle led to a slight de-acceleration in subscription revenues and a decline in support revenues for the quarter.
Back-End Loaded Quarter and Slip Deals
The quarter was heavily back-end loaded, resulting in several deals pushed from the last few days of the quarter to the first two weeks of July.
Challenges in Accelerating Growth
The company is facing challenges in accelerating growth, and there is a need for a go-to-market approach and a culture of urgency.
Impact of Currency Fluctuations
Currency fluctuations, especially the weakening of the USD against the Israeli shekel, resulted in a 0.5 point headwind to the margin this quarter, with further potential impacts expected.
Company Guidance
In the recent call, Check Point Software provided detailed guidance for the upcoming quarters, emphasizing their commitment to maintaining strong growth and operational efficiency. They reported second-quarter revenues of $665 million, surpassing their midpoint projection by $3 million, with a non-GAAP EPS of $2.37, reflecting a 9% year-over-year growth. The company highlighted a 6% revenue growth, driven by robust product revenue and subscription growth, particularly in AI-powered Quantum Force firewalls, which saw a 12% year-over-year increase. Despite some back-end-loaded deals slipping into the third quarter, the company remains confident, reiterating their 2025 guidance and projecting third-quarter revenues between $657 million and $687 million, with a non-GAAP EPS forecast of $2.40 to $2.50. They are also investing heavily in AI and go-to-market strategies to enhance their long-term growth trajectory, while acknowledging potential headwinds from foreign exchange rates and anticipated operational expenses.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
Positive
203.34
Price Trends
197.11
Positive
209.71
Negative
209.06
Negative
Market Momentum
1.63
Negative
63.36
Neutral
72.46
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHKP, the sentiment is Positive. The current price of 203.34 is above the 20-day moving average (MA) of 195.65, above the 50-day MA of 197.11, and below the 200-day MA of 209.06, indicating a neutral trend. The MACD of 1.63 indicates Negative momentum. The RSI at 63.36 is Neutral, neither overbought nor oversold. The STOCH value of 72.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 |
|---|---|---|---|---|---|---|---|
80 Outperform | 134.25B | 125.43 | 14.49% | ― | 14.87% | -57.43% | |
76 Outperform | $22.04B | 26.50 | 30.30% | ― | 6.27% | 7.14% | |
67 Neutral | 64.06B | 33.36 | 94.14% | ― | 14.46% | 48.06% | |
67 Neutral | 46.63B | 16.36 | 13.35% | ― | 1.41% | 262.31% | |
67 Neutral | 45.02B | -1,060.48 | -2.31% | ― | 23.31% | 31.04% | |
66 Neutral | 119.54B | -398.07 | -7.91% | ― | 23.46% | -270.07% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
Performance Comparison
CHKP
Check Point
203.34
8.34
4.28%
FTNT
Fortinet
83.60
6.39
8.28%
PANW
Palo Alto Networks
200.70
31.34
18.50%
ZS
Zscaler
284.42
113.49
66.40%
CRWD
CrowdStrike Holdings
476.33
194.85
69.22%
NET
Cloudflare
217.57
135.21
164.17%
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.