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Monday, January 14, 2019

by Ian Harvey

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Option Trade – Cyberark Software Ltd (NASDAQ: CYBR) Calls

Wednesday, January 16, 2019

** OPTION TRADE: Buy CYBR FEB 15 2019 85.000 CALL at approximately $2.00.

Place a pre-determined sell at $4.00.

Also include a protective stop loss of $0.80.

The cyber-security field is a hot space. The annual cost of cyber-security attacks in the United States alone is estimated at approximately $100 billion, and that figure will only grow with the increase in technology use across all platforms. However, with such an increase in the use of technology and the growing issue of cyber-security threats, the number of companies competing to protect the networks of Fortune 500 companies has become intensely competitive.

Cyberark Software Ltd (NASDAQ: CYBR), headquartered in Petach Tikva, Israel, provides cyber-security solutions that many other companies do, but its core product occupies a niche space that it has positioned itself as the industry leader in, privileged account management. This security solution, along with diversification in its offerings from recent strategic acquisitions, and the general tailwinds in the industry provide a nice setup for CyberArk to trend higher in the near future.

Privileged account management, to put it simply, restricts unauthorized users from accessing a company's most confidential and important data and information. Privileged account management is used by less than half of large enterprises currently; however, estimates are that this figure will increase to 75% by 2020. As cyber-security attacks continue to grow, it will be increasingly essential for security managers of large firms to protect its most critical information, and this is where solutions developed by CyberArk come into the equation.

Despite competition from several large and smaller players, the International Data Corporation recognized CyberArk as the forefront of the industry with leading capabilities and strategies as well as the largest revenue base and customer base in the PAM security space.

About Cyberark Software……

CyberArk Software Ltd. engages in the development, market, and sale of access security software solutions. It operates through the following geographical segments: United States; Israel; United Kingdom; Europe, the Middle East and Africa; and Other. Its products include core privileged access security, application identity and endpoint privilege manager, and Conjur.

Recent Movement…..

Prior to today’s trading, shares of the maker of software that detects attacks on privileged accounts had gained 1.2% over the past month. This has outpaced the Computer and Technology sector's loss of 1.5% and the S&P 500's loss of 2.09% in that time.

Over the past three months, the Consensus Estimate for CYBR's full-year earnings has moved 3.68% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.

According to the latest data, CYBR has moved about 4.84% on a year-to-date basis. In comparison, Computer and Technology companies have returned an average of 2.66%. As we can see, CyberArk Software is performing better than its sector in the calendar year.

Influencing Factors…..

Enhanced functionality of Version 10 of the company’s core privileged access security solutions coupled with its new simplified pricing model is helping it in drive customer acquisition.

There is an insatiable appetite for acquisitions in the tech sector. Regardless of where the S&P 500 winds up at the end of 2019, one thing is certain: this sector will see persistent buyout interest from deep-pocketed players looking to the long term.

And CyberArk Software Ltd would be one such company that could be targeted.

CyberArk Softwareis comparatively small at a $3 billion market cap, has an established growth trajectory that includes 26% revenue expansion in fiscal 2018 and solid profitability, and operates in a fast-growth arena of tech that the big boys are looking to dominate.

An added bonus is that, unlike some of the more hype-driven corners of tech, cybersecurity solutions are increasingly seen as necessities for businesses of all sizes. That provides a bit of countercyclical appeal for companies that are worried about enterprise spending drying up if times get tough in the coming year or two.

Future Earnings…..

Brokerages predict that Cyberark Software will report $95.78 million in sales for the current quarter. Cyberark Software posted sales of $80.37 million during the same quarter last year, which suggests a positive year over year growth rate of 19.2%. The firm is expected to issue its next quarterly earnings report on Thursday, February 14.

Analysts….

Deutsche Bank upgraded shares of Cyberark Software from a hold rating to a buy rating in a report released on Thursday, December 20th. Deutsche Bank currently has $85.00 target price on the technology company’s stock.

Several other analysts have recently commented on the company…..

  • UBS Group raised their target price on Cyberark Software from $85.00 to $90.00 and gave the stock a positive rating in a research note on Thursday, November 8th.
  • Morgan Stanley set a $91.00 price target on Cyberark Software and gave the stock a buy rating in a report on Friday, October 19th. BidaskClub raised shares of Cyberark Software from a “hold” rating to a “buy” rating in a research note on Tuesday, December 4th.
  • Wedbush assumed coverage on shares of Cyberark Software in a research note on Thursday, October 18th. They issued an “outperform” rating and an $85.00 price target for the company.
  • Evercore ISI reaffirmed a buy rating and issued a $96.00 price objective on shares of Cyberark Software in a research note on Sunday, November 11th.
  • Citigroup boosted their price target on shares of Cyberark Software to $85.00 and gave the stock a “hold” rating in a research note on Thursday, November 8th.
  • Finally, Needham & Company LLC boosted their price target on shares of Cyberark Software from $80.00 to $90.00 and gave the stock a “buy” rating in a research note on Thursday, November 8th.

Cyberark Software has earned an average rating of “Buy” from the twenty-two analysts that are presently covering the stock. Four research analysts have rated the stock with a hold rating, fifteen have assigned a buy rating and one has assigned a strong buy rating to the company. The average twelve-month price target among brokers that have issued a report on the stock in the last year is $88.65.

Summary

Cyberark Software has a 12-month low of $40.63 and a 12-month high of $84.21. The firm has a market capitalization of $2.61 billion, a price-to-earnings ratio of 100.37, a P/E/G ratio of 4.35 and a beta of 2.09.

Option Trade – Corbus Pharmaceuticals Holdings Inc (NASDAQ: CRBP) Calls

Tuesday, January 15, 2019

** OPTION TRADE: Buy CRBP APR 18 2019 7.500 CALL at approximately $1.55.

Place a pre-determined sell at $3.10.

Also include a protective stop loss of $0.70.

Shares of Corbus Pharmaceuticals Holdings Inc (NASDAQ: CRBP), a clinical-stage pharmaceutical company that focuses on therapies to treat inflammatory and fibrotic diseases, has gained since last Wednesday after the company announced a new strategic collaboration.

Corbus said it reached an agreement with Japan-based Kaken Pharmaceutical Co. relating to the development and commercialization of Corbus' investigational drug called lenabasum for the treatment of systemic sclerosis (SSc) and dermatomyositis (DM).

As part of the agreement, Kaken receives exclusive rights to license, commercialize, and market lenabasum in Japan. In return, Kaken will pay Corbus an upfront fee of $27 million and up to $173 million in future royalty payments based on certain regulatory, development and sales milestones.

Due to this agreement Canaccord Genuity raised its price target on the drugmaker to $38 from $36 while maintaining its "overweight" rating. The analyst in coverage is bullish on Corbus Pharmaceuticals' recent pact with Kaken Pharmaceutical.

About Corbus Pharmaceuticals……

Corbus Pharmaceuticals Holdings, Inc is a phase 3 clinical-stage pharmaceutical company, focused on the development and commercialization of novel therapeutics to treat rare, chronic, and serious inflammatory and fibrotic diseases. The Company’s lead product candidate, lenabasum, is a novel, synthetic oral endocannabinoid-mimetic drug designed to resolve chronic inflammation and fibrotic processes.

Influencing Factors…..

CRBP had only turned in one negative session in 2019 until Friday, and was, until then, on track for its third straight weekly win of 10% or more.

All seven of brokerages in coverage rate the equity a "buy" or better, including a bull note late in 2018. 

On December 26, H.C. Wainwright initiated coverage with a "buy" rating and a $24 price target -- a more than 356% premium to the close at the time. The analyst in coverage said positive data from lenabasum trials could drive upside in the shares.

The Importance of Collaboration…..

Corbus CEO Yuval Cohen said Kaken is a "well-regarded" leader in autoimmune disease in Japan where approximately 28,000 patients suffer from SSc and another 9,000 suffer from DM.

"With this collaboration, we hope we can further contribute for the better lives of patients with rare autoimmune disease in Japan," Kaken President Tetsuo Onuma said.

Cohen also said the new partnership with Japan marks an "important next step" in achieving a vision of becoming a worldwide leader in treating inflammatory diseases.

Past Earnings.….

Corbus Pharmaceuticals last announced its quarterly earnings results on Thursday, November 8th. The biopharmaceutical company reported ($0.26) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.21) by ($0.05). The company had revenue of $1.09 million during the quarter, compared to analyst estimates of $1.66 million.

Future Earnings…..

Equities analysts expect Corbus Pharmaceuticals to post $2.29 million in sales for the current fiscal quarter. The business is expected to report its next quarterly earnings results on Monday, March 11th.

Also, analysts predict that Corbus Pharmaceuticals will report earnings of ($0.20) per share for the current quarter.

Analysts….

BidaskClub upgraded shares of Corbus Pharmaceuticals from a sell rating to a hold rating in a report released on Thursday, December 27th.

Several other analysts have recently commented on the company…..

  • Cantor Fitzgerald restated a “buy” rating and set a $36.00 price objective on shares of Corbus Pharmaceuticals in a research report on Monday, October 22nd.
  • ValuEngine raised shares of Corbus Pharmaceuticals from a buy rating to a strong-buy rating in a research report on Thursday, November 1st.
  • B. Riley assumed coverage on Corbus Pharmaceuticals in a research report on Wednesday, October 24th. They set a “buy” rating and a $22.00 price objective for the company.
  • Finally, Royal Bank of Canada started coverage on Corbus Pharmaceuticals in a report on Friday, December 7th. They issued an “outperform” rating and a $23.00 price target on the stock.

One investment analyst has rated the stock with a sell rating and seven have issued a buy rating to the stock. The company has an average rating of “Buy” and an average target price of $26.25.

Summary

CRBP has a market cap of $301.07 million, a price-to-earnings ratio of -9.09 and a beta of 2.15. Corbus Pharmaceuticals has a 12 month low of $4.50 and a 12 month high of $9.95.