Reviewing CyberArk Software (NASDAQ:CYBR) and Microsoft (NASDAQ:MSFT)


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Microsoft (NASDAQ:MSFT) and CyberArk Software (NASDAQ:CYBR) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, profitability, risk, earnings and dividends.

Earnings and Valuation

This table compares Microsoft and CyberArk Software’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Microsoft $143.02 billion 13.05 $44.28 billion $5.76 43.02
CyberArk Software $433.89 million 12.16 $63.06 million $1.76 76.69

Microsoft has higher revenue and earnings than CyberArk Software. Microsoft is trading at a lower price-to-earnings ratio than CyberArk Software, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Microsoft has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500. Comparatively, CyberArk Software has a beta of 1.37, indicating that its share price is 37% more volatile than the S&P 500.

Profitability

This table compares Microsoft and CyberArk Software’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Microsoft 32.28% 40.74% 16.23%
CyberArk Software 0.65% 4.34% 1.95%

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Microsoft and CyberArk Software, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Microsoft 0 2 30 1 2.97
CyberArk Software 0 2 12 0 2.86

Microsoft currently has a consensus price target of $287.29, suggesting a potential upside of 15.94%. CyberArk Software has a consensus price target of $155.42, suggesting a potential upside of 15.14%. Given Microsoft’s stronger consensus rating and higher possible upside, analysts clearly believe Microsoft is more favorable than CyberArk Software.

Institutional & Insider Ownership

69.0% of Microsoft shares are held by institutional investors. Comparatively, 83.7% of CyberArk Software shares are held by institutional investors. 0.1% of Microsoft shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Microsoft beats CyberArk Software on 12 of the 15 factors compared between the two stocks.

About Microsoft

Microsoft Corporation develops, licenses, and supports software, services, devices, and solutions worldwide. Its Productivity and Business Processes segment offers Office, Exchange, SharePoint, Microsoft Teams, Office 365 Security and Compliance, and Skype for Business, as well as related Client Access Licenses (CAL); Skype, Outlook.com, OneDrive, and LinkedIn; and Dynamics 365, a set of cloud-based and on-premises business solutions for small and medium businesses, large organizations, and divisions of enterprises. Its Intelligent Cloud segment licenses SQL and Windows Servers, Visual Studio, System Center, and related CALs; GitHub that provides a collaboration platform and code hosting service for developers; and Azure, a cloud platform. It also offers support services and Microsoft consulting services to assist customers in developing, deploying, and managing Microsoft server and desktop solutions; and training and certification to developers and IT professionals on various Microsoft products. Its More Personal Computing segment provides Windows original equipment manufacturer (OEM) licensing and other non-volume licensing of the Windows operating system; Windows Commercial, such as volume licensing of the Windows operating system, Windows cloud services, and other Windows commercial offerings; patent licensing; Windows Internet of Things; and MSN advertising. It also offers Surface, PC accessories, PCs, tablets, gaming and entertainment consoles, and other devices; Gaming, including Xbox hardware, and Xbox content and services; video games and third-party video game royalties; and Search, including Bing and Microsoft advertising. It sells its products through OEMs, distributors, and resellers; and directly through digital marketplaces, online stores, and retail stores. It has a strategic collaboration with DXC Technology and Dynatrace, Inc. The company was founded in 1975 and is headquartered in Redmond, Washington.

About CyberArk Software

CyberArk Software Ltd., together with its subsidiaries, develops, markets, and sales software-based security solutions and services in the United States, Europe, the Middle East, Africa, and internationally. Its solutions include Privileged Access Manager that offers risk-based credential security and session management to protect against attacks involving privileged access; Vendor Privileged Access Manager, which combines Privileged Access Manager and Remote Access to provide fast, easy, and secure privileged access to third-party vendors; Endpoint Privilege Manager, a SaaS service that secures privileges on the endpoint; and Cloud Entitlements Manager, a SaaS solution, which reduces risk that arises from excessive privileges by implementing least privilege across cloud environments. The company also offers robust Identity and Access Management as a Service that provides artificial intelligence based and security-first approach to manage identities, such as workforce identity, which offers adaptive multi-factor authentication (MFA), single sign-on, application gateway, identity lifecycle management, and directory services; and customer identity services that provides authentication and authorization services, MFA, directory, and user management to enable organizations to provide their customers with easy and secure access to websites and applications. In addition, it offers Secrets Manager Credential Providers to provide and manage the credentials used by third-party solutions; and Secrets Manager Conjur for cloud-native applications. The company offers its products to financial services, manufacturing, insurance, healthcare, energy and utilities, transportation, retail, technology, and telecommunications industries; and government agencies through direct sales force, as well as distributors, systems integrators, value-added resellers, and managed security service providers. CyberArk Software Ltd. was founded in 1999 and is headquartered in Petah Tikva, Israel.

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