Qualys Inc (NASDAQ:QLYS) became a big mover in the last session after conveniently beating the analysts’ estimates for its fourth quarter earnings per share and revenue. The provider of cloud security and compliance solutions reported fourth-quarter earnings per share of $0.15 on revenues of $36.57 million. The reported numbers came higher than the market consensus of $0.09 earnings per share on revenue of $35.93.
Does this analyst foresee a long-term upside in QLYS?
Accelerated Demand
The company credited the growth of 24% in its revenues to the increased adoption of its new services, Web Application Scanning, Continuous Monitoring, Policy Compliance and Private Cloud Platform. Other than this, Qualys Inc (NASDAQ:QLYS)’s successful quarter was driven by its market-leading service, namely Vulnerability Management solution. Some of the renowned customers that the company added during the fourth quarter include Netflix, Inc. (NASDAQ:NFLX), Siemens AG (ADR) (OTCMKTS:SIEGY), Halliburton Company (NYSE:HAL) and British American Tobacco PLC (ADR) (NYSEMKT:BTI). The company’s deferred revenue balance grew to $91.2 million, up by 20% in the reported fiscal year. That lead to $27.4 million of 2014 free cash flow as against $11.5 million in the previous year.
Data Breach At Anthem
The demand for the company’s security technology surged following a recent data breach at the U.S. second-largest insurer, Anthem Inc (NYSE:ANTM). The cyber attack affected the insurer’s database containing personal details of its over 80 million customers and employees. In the light of the accelerated demand for cyber security products and services, Qualys Inc (NASDAQ:QLYS) has projected first-quarter guidance above the market consensus.
It expects revenues in the range of $37.6 Million to $38.1 million and EPS of $0.10-$0.12 per share, which is higher than the market estimate of $37 million revenue and $0.09 EPS. The company projected full-year revenue of $167.3-$169.3 million and EPS of $0.50-$0.55, nearly higher than consensus of $160.6 million and $0.50.
The shares of Qualys Inc (NASDAQ:QLYS) rose by nearly 15% to $46.94 yesterday. It also helped drive the shares of fellow security technology player, Imperva Inc (NYSE:IMPV) move up.
Technicals
Qualys Inc (NASDAQ:QLYS) is probably in the last phase of the bull market it has been enjoying since early 2013 and this speculative scenario gathers strength from the price action in the current week. The first phase of the bull market saw a rise to $30 from the 2013 low around $10 levels. A projection of this rise from the 2014 high gives us the target of $50 levels, a target very close to be achieved. A bout of profit booking can be expected there.
