The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, Abbott Laboratories and AbbVie, La Monica does not own positions in any individual stocks.
The Nasdaq was in blood red mode Thursday. But the big drop in tech stocks didn't hurt the performance of a red hot IPO.
So why is this stock being spared from the brutal momentum sell-off? One word: Hacking.
CyberArk develops software designed to protect companies from malicious attacks by cybercriminals, so-called "hacktivists" and even government-sponsored groups engaging in industrial espionage.
The company's main product helps companies keep "privileged accounts" -- think of things such as log-in info for a big company's IT managers and passwords to social media accounts -- safe. And this looks like a very lucrative business.
Sales rose 30% in 2012 and another 40% last year. And revenue through the first six months of 2014 is up 33% from the same period in 2013.
CyberArk has also been profitable the past few years. It did lose money in the first half of 2014 -- but that was solely due to expenses tied to revaluing warrants ahead of the IPO.
Another plus for the company? It's already a worldwide player in the cybersecurity market. Nearly half of the company's sales come from outside the U.S. (CyberArk is based in Israel and has its U.S. headquarters in Newton, Mass.)
But investors need to be careful before they decide to board the CyberArk. Shares trade at more than 130 times last year's earnings. That's extremely expensive.
The company also faces competition from both pure-play cybersecurity firms such as Palo Alto Networks (PANW) and FireEye (FEYE) as well as subsidiaries of tech giants IBM (IBM), Oracle (ORCL) and Hewlett-Packard (HPQ).
Shares of the smaller pure-play cybersecurity stocks have been ridiculously volatile this year. They got a pop recently after Jennifer Lawrence and several other celebrities had their nude photos published online following a hack of their iCloud accounts.
But investors have to do their homework with these companies. Not all of them are going to thrive. Just look at how poorly FireEye's stock has done this year. Palo Alto, on the other hand, has been a Wall Street darling.
So will CyberArk turn out to be more like Palo Alto than FireEye? That's hard to say just yet.
The only thing that's clear is that CyberArk seems to have replaced Alibaba as Wall Street's favorite IPO flavor of the month.
Reader Comment of the Week! Not a good week for Apple (AAPL).
The jury's still out on whether BendGate is a real problem or not. But the company's iOS 8.0.1 update was a disaster. I thought the company was discontinuing the iPod Classic? Maybe Apple needs to give away some free music again. Oh wait. That was a PR nightmare too.
One follower said he was in the uncomfortable position of downloading iOS 8.0.1 right around the time Apple 'fessed up and pulled it. His concern about what might happen next (as well as a follow-up tweet about the Beastie Boys) win him this week's Reader Comment honors.
Ha! Hope the update went well. Go Giants, by the way.
And my advice to all of you new iPhone 6 and 6 Plus owners regarding that whole unintentional curve issue? Take the device out of your back pocket if you plan to Shake Your Rump!
It's clear who the losers were when Target (TGT) became the victim of a sophisticated security breach in December that eventually compromised the credit and debit card information of 40 million customers. But were there any winners, beyond the thieves?
It's a question many investors have been asking, especially since Target is hardly alone. The Washington Post reports that federal agents notified more than 3,000 U.S. companies last year that MOREPatrick M. Sheridan - Mar 27, 2014 11:51 AM ET
The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, and Abbott Laboratories, La Monica does not own positions in any individual stocks.
I love Amazon.com. Fantastic customer service. Prices are great. And as an avid reader who still likes physical copies of books (call me a Luddite if you must), the free shipping that comes with being an MOREPaul R. La Monica - Sep 6, 2012 3:40 PM ET
Investors are discerning shoppers when it comes to retail stocks.
The clear winners appear to be big-box stores such as Wal-Mart and Target, while specialty outlets such as office supply chain Staples are bringing up the rear.
Shares of Target (TGT) rose to a new 52-week high Wednesday after it reported better-than-expected quarterly earnings and raised its forecast for full-year profits. The stock has gained 26% so far this year, outperforming Wal-Mart's MOREBen Rooney - Aug 15, 2012 2:13 PM ET
The annual Macy's 4th of July fireworks show in New York City provided the usual oohs and ahhs. But the pyrotechnics were quickly replaced by a dud of a June sales report from Macy's Thursday morning.
Macy's (M) said that sales at stores open at least a year, the most widely watched measure of health in retailing, were up just 1.2% from a year ago. Analysts were expecting so-called same-store sales MOREPaul R. La Monica - Jul 5, 2012 12:24 PM ET
Not a member yet?Sign up now for a free account
|Glenn Beck walks off CNN interview over questions about his media company|
|Fox News commentator apologizes for racist remark|
|Can Starbucks be fixed?|
|The weird reason that mighty Amazon isn't in the Dow|
|'Jurassic World' sequel crosses $700 million at global box office|