Jefferies Expects Check Point Software (CHKP) To Beat Estimates

Jefferies & Company analysts Katherine Egbert and Ignatius Njoku reiterated their Buy rating for shares of Check Point Software Technologies Ltd. (Nasdaq: CHKP), with a price target of $45 per share.

Ahead of Check Point Software Technologies' Wednesday earnings report, the analysts said, "We expect Check Point to meet or slightly beat Q2 estimates due to a continued hardware refresh cycle and uptake of high margin software blades. Mgmt typically revisits full year guidance at mid year. We are optimistic."

They also observed that "While overall IT and security spending seems robust, VARs participating in our June survey noted that Check Point was offering customers, particularly in Europe, incentives to migrate from Nokia to the Check Point platform. We had not seen this before, but the change could be the result of a euro-induced revenue headwind."

The Jefferies & Company analysts said that the risks faced by Check Point Software Technologies Ltd. (Nasdaq: CHKP) included, "integrating Nokia; weak spending in EMEA, Check Point's strongest market; significant exposure in opex to a strengthening US dollar; a high likelihood of future acquisitions; and a mature core market."