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Tenable – Cybersecurity Play, Safe Investment?

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Summary

Tenable Holdings is an IPO with great prospects, combining cloud and security.

Lack of internal expertise and a very real risk of cybersecurity threats result in corporations using the company’s platform in a big way.

I like the rapid growth and justifiable forward sales and billing multiples, yet require the current momentum to cool off before potentially buying a modest stake.

This idea was discussed in more depth with members of my private investing community, Value In Corporate Events.

Tenable Holdings (TENB) has gone public in an IPO which was well-received by investors, being attracted to reasonable forward billings multiples, which are combined with very strong growth.

Hence shares have risen 50% on their opening day, if you include the fact that the offer pricing took place above the preliminary offering range. This move has killed most of the immediate appeal in my eyes, although I continue to reserve a spot for Tenable on my watchlist.

Tenable trades at justifiable revenue multiples, and growth is very strong, although I am not that happy with the lack of operating leverage displayed so far, so I’m not chasing the current momentum.

Understanding And Reducing Cybersecurity Risk

Tenable provides solutions for a new category which the company calls Cyber Exposure. This category is all about managing and measuring cybersecurity risks in today’s era.

Today’s corporations are rapidly updating and modernising their IT (infrastructure). Key trends include the fact that employees work from home and corporations move into the cloud, which results in companies having less control and visibility over these assets. This is a potentially dangerous combination with cyber attacks being on the rise.

This threat is no longer just confined to IT, as actual industrial applications are being connected to the same networks as well, resulting in potential disruptions not only to the office functionality but also actual production.

Tenable has essentially built a platform which the company itself compares to a command center. This platform allows IT staff to monitor digital security, and shows actual performance through live metrics and data streams, giving staff a road map on which threats to act upon.

Read More Here

Article Credit: Seeking Alpha

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