Sophos Share Discussion Threads

[kaka47] 21/5/2017 10:43

FALANX Cyber Defence (FLX)Cyber security sector is booming and in 11 months time Gov legislations are coming in where companies will have to protect public data and have cyber protection or face massive fines equal to €20 million or 4% of their global turnover so companies are getting ready for this legislation. FALANX is one such company benefiting from this massive surge in demand. They have access to 100 NHS trusts through Mersey internal Audit Agency and Audit Yorkshire, business is booming with the ATTACK on NHS the listed companies have seen massive demand from investors for shares. Smart Money is moving fast in to the listed companies not many are listed. ....................,,Falanx Cyber security market Cap £14 million Reported Revenues £2.7 million Trading on 4.5x revenuesCurrent year 2017Revenues forecast £5 million Forecast to become profitable and cash flow positive In current year 4 years ago Falanx Share price was 60p on jam tomorrow Now they have started to deliver and share price has responded well from all time of 3.5p to Current price of 9.62p Amazingly Market Cap is still £14 million Falanx is still Grossly underpriced

[sogoesit] 19/5/2017 10:38

Here's today's IC article:

Ransomware attack shines light on Sophos
The importance of effective cyber security was shown all too clearly by last week's ransomware attack on the NHS. But even without the spikes in demand caused by such high profile events, cyber security is the fastest-growing division of the IT industry, accelerating at 7 per cent a year. Sophos (SOPH) has, once again, outpaced that growth. Reported billings rose by a fifth at constant currencies to $632m (£486m) as the group added more than 40,000 organisations to its books, to take its total customer base above a quarter of a million.

Alongside new customers, Sophos has been adding new products including the Intercept X which stops IT systems from being infiltrated by ransomware - timely, indeed. Such new products not only attract new customers, but encourage existing ones to add bolt-on services, meaning the group's current contract renewal rate stands at 106 per cent.

Adjusted operating profit was hit by a higher level of deferred revenue (meaning expenses have been taken on contracts but all the revenue not yet booked). Adjusted cash profits - a more reflective measure of profitability - rose 24 per cent to $150m, while free cash flow nearly tripled to $133m. Management expects this rate of growth to continue and has targeted adjusted operating profits of $100m by FY2020.

Analysts at JP Morgan expect adjusted EPS of 10.9ȼ in the year to March 2018 (from 16.2ȼ in FY2017)

SOPHOS (SOPH)
ORD PRICE: 403.7p MARKET VALUE: £1.86bn
TOUCH: 403-404p 12-MONTH HIGH: 407p LOW: 146p
DIVIDEND YIELD: 0.9% PE RATIO: na
NET ASSET VALUE: 28ȼ* NET DEBT: 219%
Year to 31 Mar Turnover ($m) Pre-tax profit ($m) Earnings per share (ȼ) Dividend per share (ȼ)
2013 362 -144.0 -35.4 na
2014 379 -91.0 -25.9 na
2015 447 -54.0 -14.7 na
2016† 478 -68.4 -16.4 1.8
2017 530 -49.3 -10.3 4.6
% change +11 - - +156
Ex-div: 14 Sep

Payment: 13 Oct

*Includes intangible assets of $856m, or 186ȼ a share

†Sophos listed in July 2015 £1=$1.30

IC VIEW:
After stellar growth, the shares now trade on 48 times expected earnings, but we think the top line growth, the deferred revenue and the repeat business will sustain the momentum. Buy.
Last IC View: Buy, 228p, 9 Nov 2016

[aishah] 19/5/2017 09:48

Cyber security companies boosted by hack concerns

Being the software security provider to the recently hacked NHS has not hurt Sophos (SOPH). Shares in the UK's biggest listed cyber security company rose 8 per cent on Monday, as investors speculated - with good reason - that the group's services are likely to be in greater demand after the high-profile cyber ransom attack.

According to Sophos chief executive Kris Hagerman customer numbers have risen steadily over the past few years as more organisations realise the importance of good cyber security. High-profile hacks, like that on the NHS, "spike the flow" of that increase, he said.

More at investorschronicle.co.uk

[briangeeee] 19/5/2017 09:39

gersemi, some sales (like network hardware) are standard, and booked straight to revenue. However, some are multi year deals. Not sure exactly what their pricing is, but might be something like £100 for 1yr, £180 for 2yrs, or £250 for 3yrs. All billed immediately, and payable up front.

Since revenue can't be recognised until the service has been provided, they can only recognise revenue for the time that has lapsed since the start of the period. For clarity, they display the whole amount in "Billings".

In terms of the balance sheet, they book the billing originally in debtors, and when cash is received (up front), that moves to cash. Liabilities are created in Current and Non-Current Deferred Income to reflect the unearned part of the Billing. As time passes, Deferred Income is reduced as Revenue is earned.

So, I'm happy that their cash approach to accounting is an acceptable (if less conservative) method to represent the progress of their business.

[gersemi] 19/5/2017 07:11

Sorry to be a pain but can someone be so kind as to briefly explain how Sophos book their revenues..

Do they offset all costs (some companies flatter profit by capitalising R & D) against income?

thanks

[dan_the_epic] 18/5/2017 20:33

Who cares about profits. This is all about cash. The more billings growth, the more cash, but less profits.

You are fundamentally misunderstanding the business, monty.

[montyhedge] 18/5/2017 12:56

Wow, well done boys, market cap nearly £2 billion and making a loss, you done well.

[aishah] 18/5/2017 09:52

MARKET REPORT: Cyber security firm Sophos shoots to top of FTSE 250 after posting upbeat results in wake of WannaCry virus chaos

Cyber security firm Sophos shot to the top of the FTSE 250 after posting an upbeat set of results in the wake of the WannaCry virus chaos.

The firm saw £117.8m added to its value after boasting that its customers had not been hit by Friday’s ransomware attack, which left hundreds of thousands of organisations reeling.

In fact, its program to protect against such attacks has become the fastest-growing software in its history. Customers include a number of NHS trusts, which chief executive Kris Hagerman said had been successfully defended against WannaCry.
+1

He said: ‘It is a wake-up call for the world that IT security has to be a top priority.’

Sophos was founded 30 years ago by Oxford University friends Jan Hruska and Peter Lammer, before growing into one of Europe’s biggest cyber security companies. The pair have each seen the value of their 9.25 per cent stakes in Sophos rise £25m since the cyber attack on Friday, with shares up more than 17 per cent in just six days.

The firm’s revenues also rose 10.8 per cent to £408.2m, while losses narrowed from £52.7m last year to £37.9m in the year to March 31.

Yesterday, it saw shares rise 6.9 per cent, or 25.6p, to an all-time high of 395.4p.

Read more:

[dan_the_epic] 17/5/2017 19:58

2020 expected numbers are superb

[sogoesit] 17/5/2017 16:37

From the results today here are the Delta's in percent in order to get a handle on operational gearing:

Revenue: +10.77%
CoS: +16.19%
Gross Profit: +9.26%

Sales & Marketing: +14.46%
R&D: +18.27%
Finance & Admin: +1.14%
Sub-Total Operating Costs: +11.37%

This is just the booked revenue not the billed revenue. Billed revenue: +18.62%

Overall it looks like 1:1 approximately for the time being.

[aishah] 17/5/2017 11:35

TechMarketView:

Soaring Sophos

Following its upbeat trading update of last month, Sophos Group has delivered ahead of its own expectations for the full year (to March 31 2017), driving shares that had already risen c9% on the back of the global ransomware attack, further up again. They rose another c8% on their Tuesday closing price in early Wednesday trading, peaking at a record high.

It’s easy to see what has driven the surge because revenue rose 10.8% at the specialist security company to $529.7m, with billings up 18.2% to $632.1m. The billings model took its toll on the bottom line naturally, resulting in an deeper operating loss of $44.3m, but increased billings also means visibility on rising deferred revenue. Confident Sophos is guiding billings growth in the mid to high teens in FY18 and is looking at $1bn in the mid term.

Sophos Central was a growth engine, with 220% growth to $87.7m and now 17.1% of subscription billings (vs. 6.5%) but network and end point offerings (and geographic regions) also saw good growth. The expanding Sophos Central cloud platform is rapidly growing in capability, including the addition of Intercept X - endpoint protection utilising signature-less anti-exploit, anti-ransomware and root cause analytics capabilities. It is being well received, with 8000 customers buying into Intercept X in the two quarters since its launch.

Security is about confidence in the technology but also the supplier and Sophos is proactive on these fronts, with its approach to synchronised security and its level of responsiveness (we have previously seen their incident room in Oxfordshire in action and the levels of responsiveness even on a ‘normal’ day). In terms of technology, Intercept X and its Exploit Prevention offerings are designed to proactively protect against ransomware – but Sophos also offers the necessary multi technology, multi layered approach.

In a digital world where security breaches are inevitable, the speed and effectiveness of the responses is critical (as the NHS for example, knows). If Sophos can showcase how it handled WannaCrypt it will do itself a lot of good – and maybe help accelerate cyber security investment.

[steeplejack] 17/5/2017 11:29

I couldn't bring myself to chase the stock when it leapt as a result of last Friday's cyber attacks.Mistake.Difficult call now.It might just keep going on the back of those cash generation numbers and uncompromisingly optimistic statement.

[staylow2] 17/5/2017 10:04

It's another Blue Prism IMO

[aishah] 17/5/2017 08:47

Now a doubler. Keep'em running imo.

[hamidahamida] 17/5/2017 08:00

Ecsc Cyber security market cap £54 million Trading on 15x revenues Reported Revenues £3.6 million (prorata)Current year 2017Revenues Forecast £6 Million With a loss of £1.57 million ....................,,Falanx Cyber security market Cap £13 million Reported Revenues £2.7 million Trading on 4.5x revenuesCurrent year 2017Revenues forecast £5 million Forecast to become profitable In current year Falanx should be over 30pCurrent price 9pif same multiples are applied

[sogoesit] 17/5/2017 07:44

Good figures.
Been on my watch list too steeplejack but been distracted by one or two other stocks recently. Must do some valuation checking to see how it stacks up.
A 20% grower, guiding £1 billion revenue in medium term and some high growth from Sophos Central, whatever that is.

[aishah] 16/5/2017 09:40

IT firms hope for cyber hack boost as businesses tighten up their defences after global hack

Cyber security and IT firms are set for a lift this week as spooked businesses tighten up their defences following Friday’s global hack.

They were told to update their security software after the attack on the NHS, Telefonica in Spain and FedEx in the US among others.

Technology analyst Paraag Amin said the warning was likely to benefit cyber security consultants and IT services firms – such as Redcentric, Coretx, NCC and Sophos.

Read more:

[steeplejack] 15/5/2017 12:10

The NHS has been listed among Sophos customers.

Interesting.To buy today is a bit like buying an umbrella manufacturer in the middle of a thunderstorm given Friday's outrages.
Nonetheless,with good figures to be announced on Wednesday,the company might have further to go and this is a pretty thin market.Have had it on my watch list for sometime.Bit late!

[aishah] 15/5/2017 10:09

UKHotViews:

NHS ransomware attack highlights risk of slow cyber security investment

"Ransomware is a growing menace, easily leased to semi-professional cybercriminals as on-demand, cloud-hosted ‘malware as a service’ kits that use digital currencies like bitcoin to extract money.

It can be stopped though, or at least its damage mitigated. Sophos, Symantec, Check Point and Kaspersky Labs are just a few security software suppliers offering tools to counter the threat, while strong system access control policies can limit the spread and regular back-ups of files to off-net locations aid fast recovery."

[aishah] 15/5/2017 07:56

Deutsche retains BUY, ups target to 350p from 290p

[dan_the_epic] 14/5/2017 23:12

Doubt the cyberattack will help the share price; certainly didn't Friday close or help the US stocks

The big question here is what happens with Apax. Long term I like this stock and look forward to next week

[kkclimber56] 14/5/2017 22:47

The saying "it's and ill will etc" springs to mind.

[lupins2] 14/5/2017 21:12

Just what I was thinking--tomorrow could be very interesting. GLAH- I may top up here early doors.

[jurgenklopp] 13/5/2017 08:15

Surely the global cyber attack yesterday will focus attention of the likes of Sophos

hxxps://www.sophos.com/en-us/lp/ransomware.aspx?cmp=701j0000001ZsLFAA0