CyberArk Software Ltd. (NASDAQ: CYBR) has recently garnered attention as one of the most discussed AI stocks on Wall Street. On September 23, 2023, analyst Trevor Walsh from Citizens JMP took the step to downgrade CyberArk’s stock rating from ‘Market Outperform’ to ‘Market Perform’, without setting a price target. This decision was influenced primarily by the anticipated acquisition by Palo Alto Networks (PANW).
The analysis from the firm suggests that there is currently no superior alternative proposal, and that the merger is likely to adhere to the expected timeline.
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“We are downgrading our rating to ‘Market Perform’ from ‘Market Outperform’ (formerly set at a $480 price target) due to the pending acquisition from Palo Alto Networks. Both companies have mutually agreed to the terms of Palo Alto’s offer, which includes $45 in cash and 2.2005 PANW shares for every CyberArk share. Currently, CyberArk is trading at a CY26E EV/revenue multiple of 15.9x, slightly above the average peer group multiple of 15.0x. Given that the shares are trading just above our previous price target, we conclude that this represents a fair valuation, and we do not foresee any unsolicited takeover bids at this juncture. We believe the acquisition will proceed as planned,”
CyberArk Software Ltd. specializes in developing, marketing, and selling innovative software solutions and services focused on identity security.
While there is acknowledgment of CyberArk’s potential within the investment space, there are AI stocks that are perceived to provide better upside opportunities with reduced downside risks. For those interested in an AI stock that is currently undervalued and poised to benefit from trends influenced by the Trump administration’s tariffs and onshoring initiatives, consider our complimentary report on the best short-term AI stock.
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