Fortinet (NASDAQ: FTNT) and Sustainable (NASDAQ: TENB) led cybersecurity stocks higher on Wednesday as Wedbush Securities Investments praised the duo after reporting strong fourth-quarter results and 2023 guidance.
Analyst Dan Ives, who has beat score on both Fortinet (FTNT) and Sustainable (TEMP), noted that the two have shown continued strength in the area of federal spending as well as commercial enterprise.
As for Fortinet ( FTNT ), Ives said the results were “generally solid,” even if there was a small revenue miss compared to expectations, but other metrics were well above Wall Street expectations.
“While Fortinet is held to a higher standard by the Street given the company’s history in large markets relative to its peers, we believe this performance and outlook were good not only for Fortinet, but also as a barometer of overall cybersecurity spending with many bears who are waiting because of a big stumble at the door,” Ives wrote in a message to clients.
Ives added billings growth, strong free cash flow performance and a “terrific” business model make Fortinet ( FTNT ) “attractive” at these levels.
He raised his price target per share to $70 from $64 after the results.
Fortinet (FTNT) up nearly 14% to $61.21 in early trading on Wednesday.
For Tenable ( TENB ), Ives said the most important takeaway from the results was “solid” guidance for 2023, boosting confidence in the new fiscal year.
“It is clear that Tenable is gaining a greater foothold in the enterprise and federal business stream, which adds confidence to the 2023 growth story,” Ives wrote.
Tenable ( TENB ) expects first-quarter revenue to be between $186 million and $188 million, compared with expectations of $190.9 million, while full-year revenue is expected to be between $800 million and $810 million, compared with expectations of 815.8 million dollars.
Tenable (TENB) attached 3.6% to $44.99 in early trading.
Other cybersecurity stocks that rose based on the results included Zscaler ( ZS ), CyberArk Software ( CYBR ), Check Point Software Technologies ( CHKP ), and Palo Alto Networks ( PANW ).
Late last month, Wells Fargo listed Tenable ( TENB ) among its top “tactical ideas” in the cybersecurity space.