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Check Point shares jump on outlook
Q3 revenues rise 22% and EPS tops Street forecasts
Check Point (CHKP: news, chart, profile) said it now expects to report earnings of $1.05 to $1.06 a share for the year, up from its originally anticipated range of 99 cents to $1.03 a share.
For the fourth quarter, the company sees earnings of 28 to 29 cents a share on revenue of $136 million to $144 million.
The average earnings forecast of analysts polled by Thomson First Call had been 27 cents a share for the fourth quarter and $1.02 for the year.
Check Point shares closed up $3.08, or about 17 percent, at $21.
The company expects the results over the next three to five quarters will be driven by products it has introduced over the past six to nine months, such as Connectra, InterSpect and Integrity.
"I think we are gaining against the competitors right now," Check Point CEO Gil Shwed told CBS MarketWatch.
The improved outlook follows the company's third-quarter report of earnings of $66.8 million, or 26 cents a share, up from $58.4 million, or 23 cents, in the year-earlier period. Revenue advanced 22 percent to $129.3 million from $106.3 million.
Excluding charges related to the acquisition of Zone Labs, Ramat Gan, Israel-based Check Point earned $69.1 million, or 27 cents a share, in the third quarter.
The average analyst forecast for the third quarter was earnings per share of 25 cents on sales of $128.3 million.
The company attributed the strong quarterly results to the strength of the core markets for virtual private network, firewall and management products, which displayed strength in all geographic locations.
"As we begin the fourth quarter, we expect that the results, success and leadership in the past quarter will continue into Q4," Shwed said on the company's conference call.
Operating income, excluding acquisition-related charges, improved to $71.9 million from $62.1 million in third-quarter 2003, the company said.
Operating margin for the third quarter, excluding acquisition-related charges, was 56 percent, up from 54 percent in the second quarter.
Deferred revenues were $124.8 million in the quarter, the company said, an increase of 26 percent over third-quarter 2003 levels.
J.P. Morgan analyst Sterling Auty told clients the third-quarter numbers were better than expected on all fronts. He expects the stock will continue to rally well into the fourth quarter given the poor sentiment coming into the release.
Q3 revenues rise 22% and EPS tops Street forecasts
Check Point (CHKP: news, chart, profile) said it now expects to report earnings of $1.05 to $1.06 a share for the year, up from its originally anticipated range of 99 cents to $1.03 a share.
For the fourth quarter, the company sees earnings of 28 to 29 cents a share on revenue of $136 million to $144 million.
The average earnings forecast of analysts polled by Thomson First Call had been 27 cents a share for the fourth quarter and $1.02 for the year.
Check Point shares closed up $3.08, or about 17 percent, at $21.
The company expects the results over the next three to five quarters will be driven by products it has introduced over the past six to nine months, such as Connectra, InterSpect and Integrity.
"I think we are gaining against the competitors right now," Check Point CEO Gil Shwed told CBS MarketWatch.
The improved outlook follows the company's third-quarter report of earnings of $66.8 million, or 26 cents a share, up from $58.4 million, or 23 cents, in the year-earlier period. Revenue advanced 22 percent to $129.3 million from $106.3 million.
Excluding charges related to the acquisition of Zone Labs, Ramat Gan, Israel-based Check Point earned $69.1 million, or 27 cents a share, in the third quarter.
The average analyst forecast for the third quarter was earnings per share of 25 cents on sales of $128.3 million.
The company attributed the strong quarterly results to the strength of the core markets for virtual private network, firewall and management products, which displayed strength in all geographic locations.
"As we begin the fourth quarter, we expect that the results, success and leadership in the past quarter will continue into Q4," Shwed said on the company's conference call.
Operating income, excluding acquisition-related charges, improved to $71.9 million from $62.1 million in third-quarter 2003, the company said.
Operating margin for the third quarter, excluding acquisition-related charges, was 56 percent, up from 54 percent in the second quarter.
Deferred revenues were $124.8 million in the quarter, the company said, an increase of 26 percent over third-quarter 2003 levels.
J.P. Morgan analyst Sterling Auty told clients the third-quarter numbers were better than expected on all fronts. He expects the stock will continue to rally well into the fourth quarter given the poor sentiment coming into the release.
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