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Radware Ltd (RDWR)
NASDAQ:RDWR
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Radware
(NASDAQ:RDWR)
Rating:66Neutral
Price Target:
$27.00
▲(8.70% Upside)
Positive Factors
Cloud Growth
The company achieved 21% Cloud ARR growth, its highest in five quarters, indicating strong demand in the cloud sector.
Revenue Performance
Total revenue was up double digits for the fourth consecutive quarter, showcasing robust financial health.
Negative Factors
Analyst Rating
While constructive on RDWR stock, the analyst maintains a Hold rating, pending a consistent trend of revenue re-acceleration and execution on the company's stock buyback.
Market Strategy
The reconstruction of the North America go-to-market strategy is ongoing, which may impact short-term performance.
Radware (RDWR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.06B
Dividend YieldN/A
Average Volume (3M)204.81K
Price to Earnings (P/E)77.3
Beta (1Y)0.92
Revenue Growth11.51%
EPS GrowthN/A
CountryUS
Employees1,137
SectorTechnology
Sector Strength84
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)0.28
Shares Outstanding42,686,535
10 Day Avg. Volume131,473
30 Day Avg. Volume204,811
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.03
Enterprise Value/Revenue3.79
Enterprise Value/Gross Profit4.70
Enterprise Value/Ebitda52.44
Forecast
1Y Price Target
$30.67Price Target Upside23.47% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
Radware Business Overview & Revenue Model
Company DescriptionRadware (RDWR) is a leading provider of application delivery and cyber security services for virtual, cloud, and on-premise environments. The company operates primarily in the technology sector, focusing on solutions that enable businesses to optimize their applications' performance, security, and availability. Radware's core products include application delivery controllers (ADCs), web application firewalls (WAFs), and DDoS protection solutions, catering to various industries such as finance, healthcare, and e-commerce.
How the Company Makes MoneyRadware generates revenue through a combination of product sales, subscription services, and managed services. Key revenue streams include the sale of hardware and software solutions, annual maintenance contracts, and cloud-based security services. The company also offers professional services such as consulting and implementation. Significant partnerships with cloud service providers and technology integrators enhance its market reach and contribute to earnings. Additionally, growing demand for cybersecurity solutions in response to increasing cyber threats has positively impacted Radware's revenue growth.
Radware Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 29, 2025
Earnings Call Sentiment Positive
Radware demonstrated strong financial performance with consistent revenue growth and notable achievements in cloud ARR and major deals. However, challenges such as decreased cash flow compared to the previous year and persistent budget concerns in large enterprises were noted. The overall sentiment leans towards positive due to the significant outweighing of highlights over lowlights.Q2-2025 Updates
Positive Updates
Consistent Revenue Growth
Radware reported its fourth consecutive quarter of double-digit revenue growth with a 10% year-over-year increase to $74 million.
Strong Cloud ARR Growth
Cloud ARR growth accelerated from 19% to 21% year-over-year, reaching $85 million, surpassing the short-term target of 20%.
Impressive Non-GAAP Earnings Increase
Non-GAAP earnings per share rose 39% year-over-year to $0.28.
Significant Cash Flow from Operations
Generated $14.5 million in cash flow from operations, underscoring operational strength.
Major Wins in Cloud Security
Secured several 7-digit deals, including contracts with a European government, a major Asian bank, and a global sporting event.
Recognition in Application and API Security
Named a leader in the GigaOM Radar for application and API security for AI-driven capabilities.
Strong Regional Performance
EMEA revenue up 22% year-over-year, APAC revenue increased 30%, and stable performance in the Americas.
Negative Updates
Decreased Cash Flow Compared to Previous Year
Cash flow from operations in Q2 2025 was $14.5 million compared to $23 million in the same quarter last year.
Challenges in Large Enterprise Sales
Long sales cycles and budget concerns persist among large enterprises, particularly in North America.
Operational Expense Increase
Increased investment in sales, marketing, and R&D, contributing to higher operating expenses.
Company Guidance
During the second quarter of 2025, Radware demonstrated strong financial performance, achieving a 10% year-over-year revenue increase to $74.2 million and a non-GAAP earnings per share rise of 39% to $0.28. The company also reported $14.5 million in cash flow from operations, highlighting operational resilience. Cloud ARR growth accelerated from 19% to 21% year-over-year, reaching $85 million, while total ARR rose 8% to $235 million. The company's gross margin remained robust at 82.2%, and operating income increased by over 50% to $9.5 million. Additionally, Radware's adjusted EBITDA for Q2 2025 grew 37% to $11.4 million, with the core business achieving a 19% EBITDA margin. Looking ahead, Radware anticipates Q3 2025 revenue to be between $74.5 million and $75.5 million, with non-GAAP diluted EPS ranging from $0.26 to $0.27. The company continues to focus on scaling cloud ARR growth and expanding its AI-driven capabilities to foster long-term growth opportunities.Radware Financial Statement Overview
Summary
Radware shows a solid financial turnaround with strong revenue growth and improved profitability. The company has an excellent gross margin and efficient cash flow management. However, there is room for improvement in net profit margins and free cash flow growth.Income Statement
Radware's TTM (Trailing-Twelve-Months) revenue grew by 5.06% from the previous annual period, indicating solid top-line growth. The gross profit margin stands at 80.71%, reflecting excellent cost management and operational efficiency. However, the net profit margin of 4.91% reveals moderate profitability, suggesting room for improvement. EBIT and EBITDA margins have improved from negative to 1.90% and 7.24%, respectively, indicating a turnaround from past losses.68
Positive
Balance Sheet
The company maintains a robust balance sheet with a low debt-to-equity ratio of 0.05, highlighting conservative leverage practices. The equity ratio is strong at 51.42%, indicating reliance on equity financing. Return on Equity (ROE) has improved to 4.18%, showing better utilization of shareholder equity compared to previous losses.75
Positive
Cash Flow
Radware's free cash flow growth is negative, declining from the previous period, yet the company generates substantial operating cash flow. The operating cash flow to net income ratio is 4.56, demonstrating strong cash conversion efficiency. The free cash flow to net income ratio is 4.12, indicating efficient cash generation relative to earnings.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 288.81M | 274.88M | 261.29M | 293.43M | 286.50M | 250.03M |
| Gross Profit | 233.12M | 221.63M | 209.58M | 239.54M | 234.05M | 204.94M |
| EBITDA | 20.89M | 7.95M | -19.44M | 8.35M | 28.42M | 16.73M |
| Net Income | 14.16M | 6.04M | -21.59M | -166.00K | 7.81M | 9.64M |
Balance Sheet | ||||||
| Total Assets | 658.54M | 618.68M | 571.92M | 647.40M | 634.87M | 623.44M |
| Cash, Cash Equivalents and Short-Term Investments | 273.51M | 275.78M | 330.59M | 298.04M | 287.89M | 310.49M |
| Total Debt | 17.72M | 18.27M | 20.70M | 24.15M | 27.45M | 30.07M |
| Total Liabilities | 278.80M | 261.60M | 248.64M | 278.96M | 264.87M | 234.98M |
| Stockholders Equity | 338.57M | 316.27M | 284.09M | 332.16M | 369.99M | 388.46M |
Cash Flow | ||||||
| Free Cash Flow | 58.31M | 66.33M | -8.93M | 23.33M | 66.17M | 53.14M |
| Operating Cash Flow | 64.57M | 71.61M | -3.50M | 32.15M | 71.77M | 61.81M |
| Investing Cash Flow | -44.32M | -39.52M | 92.78M | -56.02M | 7.85M | -14.37M |
| Financing Cash Flow | -3.21M | -3.91M | -64.93M | -22.46M | -41.88M | -33.42M |
Radware Technical Analysis
Negative
24.84
Price Trends
26.99
Negative
25.37
Negative
23.92
Positive
Market Momentum
-0.41
Negative
43.95
Neutral
25.54
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RDWR, the sentiment is Negative. The current price of 24.84 is below the 20-day moving average (MA) of 24.89, below the 50-day MA of 26.99, and above the 200-day MA of 23.92, indicating a neutral trend. The MACD of -0.41 indicates Negative momentum. The RSI at 43.95 is Neutral, neither overbought nor oversold. The STOCH value of 25.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RDWR.
Radware Risk Analysis
Radware disclosed 43 risk factors in its most recent earnings report. Radware 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
Radware Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $1.29B | 25.73 | 24.39% | 1.35% | 11.04% | 18.70% | |
74 Outperform | $11.07B | 27.37 | 9.21% | ― | 3.98% | -31.18% | |
72 Outperform | $1.22B | 30.96 | 4.72% | ― | -2.32% | 7.70% | |
69 Neutral | $1.80B | 25.03 | 4.88% | ― | 5.29% | ― | |
66 Neutral | $1.06B | 77.29 | 4.46% | ― | 11.51% | ― | |
61 Neutral | $35.51B | 8.11 | -11.05% | 1.89% | 8.55% | -8.72% | |
52 Neutral | $634.65M | ― | -4.06% | ― | ― | ― |
* Technology Sector Average
Performance Comparison
RDWR
Radware
24.84
4.25
20.64%
AKAM
Akamai
77.19
-19.35
-20.04%
NTCT
Netscout Systems
25.05
5.00
24.94%
VRNT
Verint Systems
20.36
-5.85
-22.32%
ATEN
A10 Networks
17.82
4.73
36.13%
CGNT
Cognyte Software
8.69
1.31
17.75%
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.