You knew it was coming. The question was who was going to make the move. If one industry has had an outstanding year and run, it has been cybersecurity, and Monday the analysts at UBS said that buying some of the stocks was akin to buying San Francisco real estate now.
A UBS report on Monday was clear on what the analysts did not like, but little was said about the stocks the firm does like. The bottom line is that the UBS analyst Brent Thill is probably right. Some of these stocks have gotten way ahead of themselves, spurred along by almost daily cyberattacks on big name entities. In an interview on CNBC, Thill was still very positive on the field as a whole, but just stated that the valuations were frothy.
Most of the attention Monday focused on the downgrade of FireEye to Neutral from Buy, but UBS actually raised the price target to $55 from $50. In another even deeper cut, UBS cut Symantec to an outright Sell from Neutral, and pushed the price target to $22. The UBS team remains on the sidelines with a Neutral rating on Checkpoint and an $87 price target. While they do acknowledge the attractive valuation and solid balance sheet, they say that company will need sustained product and billings growth for them to become more positive on the stock.
Two companies are still rated Buy at UBS, and they both appear to have a very bright future.
This company continues to be well-liked on Wall Street. Fortinet Inc. (NASDAQ: FTNT) offers fast, secure and global cybersecurity solutions that provide broad, high-performance protection against dynamic security threats while simplifying the IT infrastructure. They are strengthened by the industry’s highest level of threat research, intelligence and analytics. Unlike pure-play network security providers, Fortinet can solve organizations’ most important security challenges, whether in networked, application or mobile environments, be it virtualized/cloud or physical.