CyberArk Software (CYBR) DCF Valuation & Fundamental Primer
CyberArk Software (CYBR) currently trades at $89.91 with an enterprise value of $6.38B. Our proprietary institutional model rates CyberArk Software at 70/100 (Grade: B+ · Quality Software Operator). The current market price prices in an implied 5-year revenue CAGR of 70.5% vs. historical growth of 21.2% (Aggressive Growth Expectations Priced In).
Institutional fundamental teardown of CyberArk Software (CYBR) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.
CyberArk Software (CYBR) 3-Scenario DCF Valuation Range
Institutional Software Quality Scorecard (70/100 · Grade B+)
Solid software model with clear operating leverage, partially offset by standard SBC or moderate burn.
Positive FCF but lower conversion efficiency due to capex or timing
Elevated equity dilution; SBC consumes substantial operating cash flow
Elite Tier-1 SaaS compounder with high gross margin and superior Rule of 40
Positive net cash cushion; self-funding operations with zero insolvency risk
Core Investment Strengths & Moats
- Top-quartile software unit economics: 79.2% gross margin and 43.2% Rule of 40 score
- Net cash positive: $497.2M balance sheet buffer
Key Operational & Dilution Risks
- Substantial SBC dilution drag: SBC is 16.9% of revenue ($168.8M)
Reverse-DCF Solver: What Growth is Priced Into CYBR?
The current share price demands 70.5% 5-year CAGR—a +49.3% acceleration over historical run-rate (21.2%). Any growth slowdown risks valuation multiple contraction.
CyberArk Software (CYBR) 5-Year Fundamental Forecast
| Statement Line Item | TTM Audited Base | TTM | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|---|---|
| Revenue | $1.00B | $1.00B | $1.21B | $1.47B | $1.78B | $2.16B | $2.61B |
| Gross Profit | $792.4M | $792.4M | $960.1M | $1.16B | $1.41B | $1.71B | $2.07B |
| Operating Income (EBIT) | $-72.8M | $-72.9M | $-88.3M | $-106.9M | $-129.6M | $-157.0M | $-190.2M |
| Stock-Based Compensation (SBC) | $168.8M | $168.7M | $204.4M | $247.7M | $300.1M | $363.6M | $440.5M |
| Unlevered Free Cash Flow (FCF) | $220.8M | $220.9M | $267.6M | $324.2M | $392.8M | $476.0M | $576.7M |
| SBC-Adjusted True Cash Flow | $52.1M | $52.1M | $63.2M | $76.5M | $92.7M | $112.4M | $136.1M |
Cybersecurity & Identity Peer Comparables Matrix
| Company | Ticker | Market Cap | TTM Revenue | Gross Margin | FCF Margin | Rule of 40 | SBC % Rev | EV / Rev |
|---|---|---|---|---|---|---|---|---|
| CyberArk Software | CYBR | $32.41B | $1.00B | 79.2% | 22.1% | 43.2% | 16.9% | 31.9× |
| CrowdStrike Holdings | CRWD | $86.18B | $3.95B | 78.0% | 31.2% | 62.2% | 19.5% | 20.9× |
| Palo Alto Networks | PANW | $126.34B | $8.03B | 74.4% | 37.8% | 56.3% | 14.2% | 15.0× |
| Fortinet, Inc. | FTNT | $10.37B | $1.11B | 72.2% | 11.2% | 32.7% | 9.6% | 9.1× |
| Zscaler, Inc. | ZS | $32.45B | $2.76B | 74.5% | 21.4% | 47.4% | 12.7% | 11.4× |
| QLYS | QLYS | $34.99B | $2.79B | 80.6% | 14.5% | 31.1% | 16.3% | 12.0× |
| SentinelOne, Inc. | S | $51.61B | $4.26B | 82.7% | 24.6% | 50.9% | 13.7% | 11.5× |
| Peer Cohort Median Benchmark (N=6) | 76.3% | 23.0% | 49.1% | 13.9% | 11.8× | |||
EV / Revenue Multiple Compression Stress Test
| Multiple Scenario | EV / Revenue | Implied Enterprise Value | Implied Equity Value | Implied Share Price | Delta vs Current |
|---|---|---|---|---|---|
| Current Multiple | 31.9× | $31.92B | $32.41B | $89.91 | 0.0% |
| -20% Multiple Compression | 25.5× | $25.53B | $26.03B | $72.20 | -20.0% |
| -35% Multiple Compression | 20.7× | $20.75B | $21.24B | $58.92 | -35.0% |
| Software Baseline Floor (5.0× EV/Rev) | 5.0× | $5.00B | $5.50B | $15.26 | -84.3% |
Frequently Asked Questions: CyberArk Software (CYBR) Valuation
What is CyberArk Software (CYBR)'s intrinsic DCF valuation and implied share price?
Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, CyberArk Software (CYBR) has a Base Case implied value of $19.09 per share (with a Bear Case of $8.87 and a Bull Case of $33.48), compared to its current price of $89.91. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.
What is CyberArk Software (CYBR)'s Rule of 40 score and Free Cash Flow margin?
CyberArk Software achieves a Rule of 40 score of 43.2%, combining a 21.2% revenue growth run-rate with a 22.1% TTM free cash flow margin on $1.00B in trailing twelve-month revenue. In the Cybersecurity & Identity peer cohort, the median Rule of 40 benchmark is 49.1%.
What revenue growth rate is priced into CYBR stock according to Reverse-DCF analysis?
At $89.91 per share (Enterprise Value of $31.92B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 70.5%, compared to CyberArk Software's historical CAGR of 21.2%. Overall market expectations are rated as "Aggressive Growth Expectations Priced In".
How does CyberArk Software compare to Cybersecurity & Identity software peers?
CyberArk Software (CYBR) earns an institutional Software Quality Score of 70/100 (Grade B+ — Quality Software Operator). Across its Cybersecurity & Identity peer group (CRWD, PANW, FTNT, ZS, QLYS), the cohort trades at a median EV/TTM Revenue multiple of 11.8× and a median gross margin of 76.3%.
How does Stock-Based Compensation (SBC) impact CyberArk Software (CYBR)'s valuation?
CyberArk Software recorded $168.8M in TTM stock-based compensation (16.9% of revenue). When treating SBC as a cash-equivalent compensation expense, CyberArk Software's SBC-adjusted free cash flow yield is 0.2%, scoring 10/25 on our Shareholder Dilution Friction pillar.