Raymond James Downgrades Check Point Software Technologies
Raymond James downgraded Check Point Software Technologies (ticker CHKP) from an Outperform rating to Market Perform and removed its $160 price target, noting that the firm does not assign price targets to stocks rated Market Perform. The brokerage attributed the downgrade to deteriorating channel trends, including weakening bookings across all segments, a bleak sales pipeline for the second half of the fiscal year, and emerging customer churn.
The note highlighted that, although demand for endpoint security solutions is growing in the AI era, operational disruptions following recent management changes and fading optimism around new CEO Nadav Zafrir after execution missteps have undermined the company’s turnaround prospects. Raymond James cautioned that Wall Street’s consensus forecasts remain overly optimistic, as the consensus expects a meaningful acceleration in product revenue, subscription growth, billings, and earnings despite limited evidence of an operational recovery.
Raymond James’s own fiscal 2027 estimates are positioned below the consensus, reflecting the current business trends. The brokerage noted that Check Point trades at roughly 13 times forward earnings and just over four times enterprise value to revenue, a valuation it considers justified given the lack of sustained earnings growth. It warned that without a credible return to growth, the stock could continue to trade closer to lower‑valued, no‑growth software peers.