NEW YORK (TheStreet) -- Trading in CyberArk Software (CYBR) - Get CyberArk Software Ltd. Report has been pretty volatile over the past 12 months. Prices have been on the defensive for the past five months, but we may have some light at end of the tunnel.
It is always good to get the negatives out of the way first. In this chart of CYBR, above, we can see a dead cross in late September and several tests and rally failures to the declining 50-day moving average. On the positive side, we can see a double bottom on the On-Balance-Volume (OBV) line in September and November, even though prices made lower lows. We can also see a bullish divergence between the lower lows in prices in September and November and the equal lows from the momentum study.
While we have only limited history on this chart, above, we can see that the $40 level (a former resistance area) should be support, and we have a higher low on the momentum study on this time frame. Bears should go into hibernation. Bulls on CYBR should consider the long side, here, using $35 as a risk point.
TheStreet Ratings team rates CYBERARK SOFTWARE LTD as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
We rate CYBERARK SOFTWARE LTD (CYBR) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- CYBR has underperformed the S&P 500 Index, declining 5.29% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
- The gross profit margin for CYBERARK SOFTWARE LTD is currently very high, coming in at 86.96%. Regardless of CYBR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 16.90% trails the industry average.
- When compared to other companies in the Software industry and the overall market, CYBERARK SOFTWARE LTD's return on equity is below that of both the industry average and the S&P 500.
- CYBR has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 4.34, which clearly demonstrates the ability to cover short-term cash needs.
- Net operating cash flow has significantly increased by 380.95% to $4.02 million when compared to the same quarter last year. In addition, CYBERARK SOFTWARE LTD has also vastly surpassed the industry average cash flow growth rate of -8.89%.
- You can view the full analysis from the report here: CYBR
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.