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PreMarket Prep Stock Of The Day: Cyberark Software

Benzinga's PreMarket Prep airs every morning from 8-9 a.m. ET. During that fast-paced, highly informative hour, traders and investors tune in to get the major news of the day, the catalysts behind those moves and the corresponding price action fo

Benzinga · 05/13/2020 18:02

Benzinga's PreMarket Prep airs every morning from 8-9 a.m. ET. During that fast-paced, highly informative hour, traders and investors tune in to get the major news of the day, the catalysts behind those moves and the corresponding price action for the upcoming session.

On any given day, the show will cover at least 20 stocks determined by co-hosts Joel Elconin and Dennis Dick along with producer Spencer Israel.

For those who don't have the time to tune in live or listen to the podcast, Benzinga will highlight one stock that merits further discussion. This analysis is not a buy or sell recommendation.

As earnings season takes a pause until the retailers begin reporting over the next few weeks, there are fewer big names on the docket.

One widely followed cybersecurity issue, Cyberark Software (NASDAQ: CYBR), did report before the open, making it the PreMarket Prep Stock Of The Day.

Not Far Off All-Time-Highs Before COVID-19 Crisis

Although the ultimate all-time high for the issue was made in July of 2019 ($148.74), it wasn't that far off that level as recently as Feb. 5, when it made an intraday high of $144.90. It was then punished on Feb. 12, when fourth-quarter EPS and sales beat was trumped by weak guidance.

On that day, it swooned from its previous days close of $138.60 to $119.38.

Taken Down With The Market During COVID-19 Crisis

The issue drifted lower to end February at $104.70 until the heavy selling kicked into full gear in March. From March 5 through March 18, it made a series of 10 consecutive lower lows, ranging from $102.05 until its ultimate bottom at $69.51.

That low coincided with a trio of monthly lows from January-March 2019 from $69.15 to $69.56.

The rebound off its March low wasn't complete until it peaked in Tuesday's session at $117.41, for a 69% rebound. However, nervous longs took some chips off the table ahead of the report as it weakened to end the session at $109.74.

Sellers Into The Report Got It Right

Before the open the company announced a first-quarter EPS beat of 14 cents along with a slight sales beat.

Either the Street was looking for a bigger revenue beat or were disappointed the company was spending $70 million in cash to acquire Adaptive Software. As of 1:30 p.m. ET, CYBR was deep in the red at $94.28, down 14%.

Moving Forward

With today's sharp decline off and overall weakness in the markets, it doesn't seem prudent to try and catch a falling knife today. Instead investors may want to purchase at a potential area of support over the next days.

One area of interest may be the 50% retracement of the recent rally from $69.51 to $117.41, which comes in at $93.46. Adding further significance to that area is that issue had a daily low on April 24 at $93.84. Also, between April 22 and April 29 six consecutive lows were made from $92.81 to $55.51.