Check Point Gains Most Since August as Profit Beats Forecast
Check Point Software Technologies Ltd. (CHKP) headed for its biggest gain in five months after the world’s second largest maker of network-security equipment said fourth-quarter net income exceeded analysts’ forecasts.
Shares of the Tel Aviv-based company rose 7 percent to $54.44 at 2:55 p.m. in New York, poised for the biggest advance since Aug. 11. Check Point was the third biggest gainer on the Bloomberg Israel-US 25 Index of the largest Israeli companies traded in New York, which advanced 1.7 percent to 90.72.
Check Point reported fourth-quarter adjusted earnings of 84 cents per shares, above the 81-cent forecast by 25 analysts surveyed by Bloomberg. Profit increased to $159.8 million from $137.4 million in the year-earlier period as revenue rose 12 percent to $356.8 million, the company said in a statement published by Marketwire.
The company reported “a very clean and solid quarter alleviating some recent unfounded concerns about product growth,” Shaul Eyal, an analyst at Oppenheimer & Co. in New York, wrote in an e-mailed report today. “The Check Point story remains on very solid ground, and we believe its high end appliances could become a growth driver in 2012 and beyond.”
Check Point, whose customers include Hewlett-Packard Co., International Business Machines Corp. and Dell Inc., is benefiting from rising demand for corporate security spending. Websites operated by the Tel Aviv Stock Exchange, El Al Israel Airlines Ltd. (ELAL), and First International Bank Ltd. were attacked yesterday by Internet hackers.
“As cyber attacks and security risks reach new levels of sophistication, customer expectations for their security infrastructure also increase,” Chief Executive Gil Shwed said in the statement. The company predicts 2012 adjusted earnings per share of $3.10 to $3.20, compared with $2.87 in 2011.
Shares will probably climb 30 percent to $70 in the next 12 months, Shebly Seyrafi, an analyst at FBN Securities, wrote in an e-mailed report today, raising the forecast from a previous $65 target.