181.23 USD
+3.07 (+1.72%)
181.23 USD
0 (0%)
We assign a fundamental rating of 7 out of 10 to CHKP. CHKP was compared to 277 industry peers in the Software industry. CHKP scores excellent points on both the profitability and health parts. This is a solid base for a good stock. CHKP may be a bit undervalued, certainly considering the very reasonable score on growth These ratings could make CHKP a good candidate for value and quality investing.
1. Profitability
1.1 Basic Checks
- CHKP had positive earnings in the past year.
- In the past year CHKP had a positive cash flow from operations.
- CHKP had positive earnings in each of the past 5 years.
- Each year in the past 5 years CHKP had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of CHKP (17.72%) is better than 93.86% of its industry peers.
- Looking at the Return On Equity, with a value of 32.79%, CHKP belongs to the top of the industry, outperforming 92.78% of the companies in the same industry.
- CHKP's Return On Invested Capital of 18.51% is amongst the best of the industry. CHKP outperforms 93.86% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for CHKP is significantly above the industry average of 10.78%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.72% | ||
| ROE | 32.79% | ||
| ROIC | 18.51% |
ROA(3y)14.46%
ROA(5y)14.34%
ROE(3y)29.1%
ROE(5y)27.36%
ROIC(3y)20.07%
ROIC(5y)19.43%
1.3 Margins
- With an excellent Profit Margin value of 37.62%, CHKP belongs to the best of the industry, outperforming 92.42% of the companies in the same industry.
- In the last couple of years the Profit Margin of CHKP has declined.
- CHKP's Operating Margin of 31.76% is amongst the best of the industry. CHKP outperforms 93.50% of its industry peers.
- CHKP's Operating Margin has declined in the last couple of years.
- Looking at the Gross Margin, with a value of 86.81%, CHKP belongs to the top of the industry, outperforming 93.50% 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 | 31.76% | ||
| PM (TTM) | 37.62% | ||
| GM | 86.81% |
OM growth 3Y-6.58%
OM growth 5Y-5.03%
PM growth 3Y-4.32%
PM growth 5Y-4.45%
GM growth 3Y-0.2%
GM growth 5Y-0.37%
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.
- The number of shares outstanding for CHKP has been reduced compared to 1 year ago.
- CHKP has less shares outstanding than it did 5 years ago.
- CHKP has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
- CHKP has an Altman-Z score of 9.04. This indicates that CHKP is financially healthy and has little risk of bankruptcy at the moment.
- CHKP's Altman-Z score of 9.04 is amongst the best of the industry. CHKP outperforms 88.45% of its industry peers.
- 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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 9.04 |
ROIC/WACC1.96
WACC9.43%
2.3 Liquidity
- CHKP has a Current Ratio of 1.19. This is a normal value and indicates that CHKP is financially healthy and should not expect problems in meeting its short term obligations.
- CHKP's Current ratio of 1.19 is on the low side compared to the rest of the industry. CHKP is outperformed by 67.15% of its industry peers.
- CHKP has a Quick Ratio of 1.19. This is a normal value and indicates that CHKP is financially healthy and should not expect problems in meeting its short term obligations.
- The Quick ratio of CHKP (1.19) is worse than 66.06% of its industry peers.
- 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 | 1.19 | ||
| Quick Ratio | 1.19 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 24.25% over the past year.
- Measured over the past years, CHKP shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.26% on average per year.
- Looking at the last year, CHKP shows a small growth in Revenue. The Revenue has grown by 6.31% in the last year.
- The Revenue has been growing slightly by 5.16% on average over the past years.
EPS 1Y (TTM)24.25%
EPS 3Y9.12%
EPS 5Y8.26%
EPS Q2Q%75.11%
Revenue 1Y (TTM)6.31%
Revenue growth 3Y5.78%
Revenue growth 5Y5.16%
Sales Q2Q%6.68%
3.2 Future
- Based on estimates for the next years, CHKP will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.82% on average per year.
- CHKP is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.81% yearly.
EPS Next Y25.58%
EPS Next 2Y8.2%
EPS Next 3Y8.94%
EPS Next 5Y11.82%
Revenue Next Year6.51%
Revenue Next 2Y6.28%
Revenue Next 3Y6.14%
Revenue Next 5Y6.81%
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
- With a Price/Earnings ratio of 16.15, CHKP is valued correctly.
- 78.34% of the companies in the same industry are more expensive than CHKP, based on the Price/Earnings ratio.
- CHKP's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.21.
- A Price/Forward Earnings ratio of 16.90 indicates a correct valuation of CHKP.
- Based on the Price/Forward Earnings ratio, CHKP is valued a bit cheaper than 79.42% of the companies in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 24.26. CHKP is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.15 | ||
| Fwd PE | 16.9 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CHKP indicates a rather cheap valuation: CHKP is cheaper than 80.14% of the companies listed in the same industry.
- 81.23% of the companies in the same industry are more expensive than CHKP, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.37 | ||
| EV/EBITDA | 17.63 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- CHKP has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)0.63
PEG (5Y)1.96
EPS Next 2Y8.2%
EPS Next 3Y8.94%
5. Dividend
5.1 Amount
- No dividends for CHKP!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
CHECK POINT SOFTWARE TECH / CHKP FAQ
What is the fundamental rating for CHKP stock?
ChartMill assigns a fundamental rating of 7 / 10 to CHKP.
Can you provide the valuation status for CHECK POINT SOFTWARE TECH?
ChartMill assigns a valuation rating of 7 / 10 to CHECK POINT SOFTWARE TECH (CHKP). This can be considered as Undervalued.
What is the profitability of CHKP stock?
CHECK POINT SOFTWARE TECH (CHKP) has a profitability rating of 8 / 10.
What is the valuation of CHECK POINT SOFTWARE TECH based on its PE and PB ratios?
The Price/Earnings (PE) ratio for CHECK POINT SOFTWARE TECH (CHKP) is 16.15 and the Price/Book (PB) ratio is 6.32.
Can you provide the expected EPS growth for CHKP stock?
The Earnings per Share (EPS) of CHECK POINT SOFTWARE TECH (CHKP) is expected to grow by 25.58% in the next year.