CHECK POINT SOFTWARE TECH (CHKP)
IL0010824113 - Common Stock
Taking everything into account, CHKP scores 7 out of 10 in our fundamental rating. CHKP was compared to 276 industry peers in the Software industry. CHKP gets an excellent profitability rating and is at the same time showing great financial health properties. CHKP is not valued too expensively and it also shows a decent growth rate. These ratings would make CHKP suitable for quality investing!
1. Profitability
1.1 Basic Checks
CHKP had positive earnings in the past year.
CHKP had a positive operating cash flow in the past year.
In the past 5 years CHKP has always been profitable.
CHKP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
CHKP has a better Return On Assets (15.26%) than 94.53% of its industry peers.
With an excellent Return On Equity value of 30.36%, CHKP belongs to the best of the industry, outperforming 94.53% of the companies in the same industry.
With an excellent Return On Invested Capital value of 20.61%, CHKP belongs to the best of the industry, outperforming 95.99% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for CHKP is significantly above the industry average of 10.44%.
The 3 year average ROIC (19.55%) for CHKP is below the current ROIC(20.61%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.26% | ||
| ROE | 30.36% | ||
| ROIC | 20.61% |
ROA(3y)14.17%
ROA(5y)14.26%
ROE(3y)27.34%
ROE(5y)25.92%
ROIC(3y)19.55%
ROIC(5y)18.82%
1.3 Margins
CHKP's Profit Margin of 34.33% is amongst the best of the industry. CHKP outperforms 95.99% of its industry peers.
CHKP's Profit Margin has declined in the last couple of years.
The Operating Margin of CHKP (36.50%) is better than 97.81% of its industry peers.
In the last couple of years the Operating Margin of CHKP has declined.
Looking at the Gross Margin, with a value of 88.34%, CHKP belongs to the top of the industry, outperforming 95.62% of the companies in the same industry.
In the last couple of years the Gross Margin of CHKP has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.5% | ||
| PM (TTM) | 34.33% | ||
| GM | 88.34% |
OM growth 3Y-5.26%
OM growth 5Y-4.83%
PM growth 3Y-5.32%
PM growth 5Y-4.08%
GM growth 3Y-0.28%
GM growth 5Y-0.27%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so CHKP is creating value.
Compared to 1 year ago, CHKP has less shares outstanding
The number of shares outstanding for CHKP has been reduced compared to 5 years ago.
There is no outstanding debt for CHKP. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
An Altman-Z score of 8.13 indicates that CHKP is not in any danger for bankruptcy at the moment.
The Altman-Z score of CHKP (8.13) is better than 84.31% of its industry peers.
CHKP has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 8.13 |
ROIC/WACC2.29
WACC9.01%
2.3 Liquidity
CHKP has a Current Ratio of 1.16. This is a normal value and indicates that CHKP is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.16, CHKP is doing worse than 70.80% of the companies in the same industry.
A Quick Ratio of 1.16 indicates that CHKP should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.16, CHKP is doing worse than 68.61% of the companies in the same industry.
The current and quick ratio evaluation for CHKP is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.16 | ||
| Quick Ratio | 1.16 |
3. Growth
3.1 Past
CHKP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.32%, which is quite good.
The Earnings Per Share has been growing by 8.05% on average over the past years. This is quite good.
CHKP shows a small growth in Revenue. In the last year, the Revenue has grown by 3.99%.
The Revenue has been growing slightly by 4.73% on average over the past years.
EPS 1Y (TTM)13.32%
EPS 3Y7.42%
EPS 5Y8.05%
EPS growth Q2Q13.33%
Revenue 1Y (TTM)3.99%
Revenue growth 3Y5.35%
Revenue growth 5Y4.73%
Revenue growth Q2Q5.76%
3.2 Future
The Earnings Per Share is expected to grow by 10.29% on average over the next years. This is quite good.
Based on estimates for the next years, CHKP will show a small growth in Revenue. The Revenue will grow by 5.98% on average per year.
EPS Next Y9.6%
EPS Next 2Y10.04%
EPS Next 3Y11.58%
EPS Next 5Y10.29%
Revenue Next Year5.97%
Revenue Next 2Y5.65%
Revenue Next 3Y5.72%
Revenue Next 5Y5.98%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 17.22, the valuation of CHKP can be described as rather expensive.
88.32% of the companies in the same industry are more expensive than CHKP, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 28.06, CHKP is valued a bit cheaper.
CHKP is valuated correctly with a Price/Forward Earnings ratio of 14.62.
Based on the Price/Forward Earnings ratio, CHKP is valued cheaply inside the industry as 89.78% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 20.72. CHKP is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.22 | ||
| Fwd PE | 14.62 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CHKP is valued cheaply inside the industry as 88.32% of the companies are valued more expensively.
CHKP's Price/Free Cash Flow ratio is rather cheap when compared to the industry. CHKP is cheaper than 87.96% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.45 | ||
| EV/EBITDA | 14.94 |
4.3 Compensation for Growth
CHKP's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of CHKP may justify a higher PE ratio.
PEG (NY)1.79
PEG (5Y)2.14
EPS Next 2Y10.04%
EPS Next 3Y11.58%
5. Dividend
5.1 Amount
No dividends for CHKP!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
CHECK POINT SOFTWARE TECH
NASDAQ:CHKP (5/2/2024, 7:00:00 PM)
After market: 149.01 -0.46 (-0.31%)149.47
+0.5 (+0.34%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
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Market Cap16.88B
Analysts
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Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
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Surprises & Revisions
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.22 | ||
| Fwd PE | 14.62 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
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OCF(TTM)
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SpS
BVpS
TBVpS
PEG (NY)1.79
PEG (5Y)2.14
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.26% | ||
| ROE | 30.36% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 36.5% | ||
| PM (TTM) | 34.33% | ||
| GM | 88.34% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.16 | ||
| Quick Ratio | 1.16 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)13.32%
EPS 3Y7.42%
EPS 5Y
EPS growth Q2Q
EPS Next Y9.6%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)3.99%
Revenue growth 3Y5.35%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
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