Summit Research Assumes Qualys (QLYS) at Buy; Sell-Off Overdone

Summit Research assumes coverage on Qualys (NASDAQ: QLYS) with a Buy rating and a price target of $50.00, saying the sell-off is overdone.

Analyst Srini Nandury commented, "We are assuming coverage of Qualys with a BUY rating and $50 PT. Qualys is the clear industry leader in Vulnerability Management (VM) and is growing faster (although the growth slowed in F1Q with stock slumping) than the market and gaining share from legacy VM vendors (McAfee). The company continues to expand its core VM offering (80% of revenue) to adjacent areas such as Policy Compliance (~9% of revenue) and Web App Scanning (~9%of revenue) and continues to upsell and cross sell to provide revenue growth for next several years. New and impending product offerings will increase TAM and provide years of growth for the company. Despite recent miss and lower guide due to delayed closing of larger transactions, we believe the company's core position in the market is still intact. After the recent pullback, we believe the stock is attractive at current levels. Our $50 PT is based on 7.6x multiple on C2016 revenue of $206mln."

For an analyst ratings summary and ratings history on Qualys click here. For more ratings news on Qualys click here.

Shares of Qualys closed at $39.36 yesterday.

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