Why SentinelOne (S) Stock Is Nosediving

Stock Story

What Happened?

Shares of cybersecurity AI platform provider SentinelOne fell 5.7% in the afternoon session after Goldman Sachs lowered its price target on the company's stock. The firm reduced its target to $16.50 from $19.00 but kept its Neutral rating.

This move followed a pattern of cautious analyst updates. For instance, Citigroup had previously cut its price target to $18.00 from $20.00. Additionally, Piper Sandler had downgraded its rating on the stock from Overweight to Neutral and lowered its price target. The negative sentiment occurred amid a broader difficult period for software stocks, with many cybersecurity companies, including SentinelOne, having lost value over the previous year.

What Is The Market Telling Us

SentinelOne’s shares are quite volatile and have had 16 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was about 2 months ago when the stock dropped 13.1% on the news that the company's fourth-quarter revenue guidance overshadowed its third-quarter earnings beat.

While the company topped Wall Street's expectations for the third quarter, reporting revenue of $258.9 million and an adjusted profit of $0.07 per share, its outlook for the upcoming quarter raised concerns among investors. SentinelOne projected its fourth-quarter revenue would be $271 million, which fell below the $273.2 million analysts had predicted. This weaker-than-expected forecast suggested a potential slowdown in growth, prompting a negative reaction in the market despite the otherwise solid quarterly performance. The guidance miss was the key factor driving the stock's decline.

SentinelOne is down 3.9% since the beginning of the year, and at $14.07 per share, it is trading 43.7% below its 52-week high of $24.97 from February 2025. Investors who bought $1,000 worth of SentinelOne’s shares at the IPO in June 2021 would now be looking at an investment worth $330.94.

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SentinelOne Settles Dispute With Israeli Tax Authority

Dow Jones Newswires

SentinelOne

+3.65%

By Kelly Cloonan

SentinelOne said it resolved its tax dispute with Israel's tax regulators.

The cybersecurity firm entered an agreement with the Israeli Tax Authority that covers transfer pricing matters for transactions with its Israeli subsidiary, including valuation and taxation matters, according to a Wednesday filing with the Securities and Exchange Commission.

The agreement covers the fiscal years ended Jan. 31, 2021 through Jan. 31, 2025.

The company expects to record an additional $14 million tax expense in the current fiscal year, which ends Jan. 31, as a result of the agreement. It also expects to record an additional $30 million tax expense related to its acquisition of Prompt Security and its Israeli subsidiary.

Write to Kelly Cloonan at kelly.cloonan@wsj.com

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Spotting Winners: Tenable (NASDAQ:TENB) And Cybersecurity Stocks In Q3

Stock Story

Looking back on cybersecurity stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Tenable and its peers.

Cybersecurity continues to be one of the fastest-growing segments within software for good reason. Almost every company is slowly finding itself becoming a technology company and facing rising cybersecurity risks. Businesses are accelerating adoption of cloud-based software, moving data and applications into the cloud to save costs while improving performance. This migration has opened them to a multitude of new threats, like employees accessing data via their smartphone while on an open network, or logging into a web-based interface from a laptop in a new location.

The 9 cybersecurity stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1% while next quarter’s revenue guidance was in line.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 13.3% since the latest earnings results.

Tenable

Starting with the widely-used Nessus vulnerability scanner first released in 1998, Tenable provides exposure management solutions that help organizations identify, assess, and prioritize cybersecurity vulnerabilities across their IT infrastructure and cloud environments.

Tenable reported revenues of $252.4 million, up 11.2% year on year. This print exceeded analysts’ expectations by 2.1%. Despite the top-line beat, it was still a slower quarter for the company with EPS guidance for next quarter missing analysts’ expectations significantly and a significant miss of analysts’ annual recurring revenue estimates.

"We delivered better-than-expected results on both the top and bottom line driven by strong demand for our Tenable One Exposure Management platform," said Steve Vintz, Co-CEO of Tenable.

Unsurprisingly, the stock is down 20.9% since reporting and currently trades at $22.67.

Read our full report on Tenable here, it’s free.

Best Q3: Qualys

Originally developed to address the growing complexity of IT security in the cloud era, Qualys provides a cloud-based platform that helps organizations identify, manage, and protect their IT assets from cyber threats across on-premises, cloud, and mobile environments.

Qualys reported revenues of $169.9 million, up 10.4% year on year, outperforming analysts’ expectations by 2.2%. The business had an exceptional quarter with EPS guidance for next quarter exceeding analysts’ expectations and a solid beat of analysts’ EBITDA estimates.

Qualys achieved the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 9.5% since reporting. It currently trades at $132.79.

Weakest Q3: Varonis Systems

Beginning with protecting Windows file shares in 2005 and evolving into a comprehensive security platform, Varonis Systems provides data security software that helps organizations protect sensitive information, detect threats, and comply with privacy regulations.

Varonis Systems reported revenues of $161.6 million, up 9.1% year on year, falling short of analysts’ expectations by 2.7%. It was a softer quarter as it posted full-year revenue guidance slightly missing analysts’ expectations and revenue guidance for next quarter slightly missing analysts’ expectations.

Varonis Systems delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 45.1% since the results and currently trades at $34.57.

Read our full analysis of Varonis Systems’s results here.

Rapid7

With its name inspired by the need for quick responses to cyber threats, Rapid7 provides cybersecurity software and services that help organizations detect vulnerabilities, monitor threats, and respond to security incidents.

Rapid7 reported revenues of $218 million, up 1.5% year on year. This number surpassed analysts’ expectations by 0.9%. Zooming out, it was a mixed quarter as it also recorded a solid beat of analysts’ EBITDA estimates but revenue guidance for next quarter slightly missing analysts’ expectations.

Rapid7 had the slowest revenue growth among its peers. The company lost 25 customers and ended up with a total of 11,618. The stock is down 23.7% since reporting and currently trades at $13.59.

Read our full, actionable report on Rapid7 here, it’s free.

SentinelOne

Built on the principle of "fighting machine with machine," SentinelOne provides an AI-powered cybersecurity platform that autonomously prevents, detects, and responds to threats across endpoints, cloud workloads, and identity systems.

SentinelOne reported revenues of $258.9 million, up 22.9% year on year. This print beat analysts’ expectations by 1.1%. It was a strong quarter as it also logged a solid beat of analysts’ billings estimates and an impressive beat of analysts’ EBITDA estimates.

SentinelOne pulled off the highest full-year guidance raise among its peers. The company added 59 enterprise customers paying more than $100,000 annually to reach a total of 1,572. The stock is down 14.3% since reporting and currently trades at $14.66.

Read our full, actionable report on SentinelOne here, it’s free.

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Cybersecurity Stocks Q3 Teardown: Rapid7 (NASDAQ:RPD) Vs The Rest

Stock Story

As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the cybersecurity industry, including Rapid7 and its peers.

The 9 cybersecurity stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1% while next quarter’s revenue guidance was in line.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 11.2% since the latest earnings results.

Rapid7

Rapid7 reported revenues of $218 million, up 1.5% year on year. This print exceeded analysts’ expectations by 0.9%. Despite the top-line beat, it was still a mixed quarter for the company with an impressive beat of analysts’ EBITDA estimates but revenue guidance for next quarter slightly missing analysts’ expectations.

"We ended the third quarter with $838 million in ARR as our AI-driven Command Platform continues to gain market validation," said Corey Thomas, CEO of Rapid7.

Rapid7 delivered the slowest revenue growth of the whole group. The company lost 25 customers and ended up with a total of 11,618. Unsurprisingly, the stock is down 13.5% since reporting and currently trades at $15.40.

Read our full report on Rapid7 here, it’s free for active Edge members.

Best Q3: Qualys

Qualys achieved the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 14.1% since reporting. It currently trades at $138.31.

Weakest Q3: Varonis Systems

Varonis Systems delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 46.8% since the results and currently trades at $33.50.

Read our full analysis of Varonis Systems’s results here.

SentinelOne

SentinelOne reported revenues of $258.9 million, up 22.9% year on year. This number topped analysts’ expectations by 1.1%. It was a strong quarter as it also logged a solid beat of analysts’ billings estimates and an impressive beat of analysts’ EBITDA estimates.

SentinelOne delivered the highest full-year guidance raise among its peers. The company added 59 enterprise customers paying more than $100,000 annually to reach a total of 1,572. The stock is down 12.2% since reporting and currently trades at $15.02.

Read our full, actionable report on SentinelOne here, it’s free for active Edge members.

Tenable

Tenable reported revenues of $252.4 million, up 11.2% year on year. This result surpassed analysts’ expectations by 2.1%. More broadly, it was a slower quarter as it produced EPS guidance for next quarter missing analysts’ expectations significantly and a significant miss of analysts’ annual recurring revenue estimates.

The stock is down 15.9% since reporting and currently trades at $24.10.

Read our full, actionable report on Tenable here, it’s free for active Edge members.

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SolGold Board Backs Sweetened $1.13 Billion Takeover Bid From Jiangxi Copper

Dow Jones Newswires

By Megan Cheah

Chinese state-owned miner Jiangxi Copper has won the support of SolGold's board after making a sweetened $1.13 billion bid for the U.K.-listed company backed by BHP and Newmont.

After two prior bids were rejected, Jiangxi's revised takeover offer has cleared the board hurdle, bringing it one step closer to the finish line.

Jiangxi upsized the deal terms to 28 pence per share of the mineral exploration company, a 7.1% premium to the stock's price before the initial proposal was disclosed, and an increase from the 26 pence offered previously.

The non-binding offer values the U.K.-listed company at 842 million pounds, or about $1.13 billion, Jiangxi and SolGold said in a joint statement Friday.

SolGold's board said it "would be minded to recommend" that shareholders vote in favor of the deal if Jiangxi makes a firm offer by the Dec. 26 deadline.

So far, shareholders holding nearly 41% of SolGold have said they intend to support the deal.

These include BHP Billiton--a unit of mining giant BHP Group--and gold miner Newmont. SolGold's co-founder, Nicholas Mather, is also backing the revised proposal, Friday's statement showed.

Jiangxi currently owns 12.2% of the issued shares of SolGold, which specializes in gold and copper mining, and has operations in Latin America.

The development comes after SolGold's board rejected Nanchang-based Jiangxi's previous two proposals in November.

SolGold's London shares last closed 8.7% lower at GBP25.75. Jiangxi's Hong Kong and Shanghai-listed shares were up 1.4% and 0.7% respectively in early trade on Monday.

There has been a flurry of dealmaking in the mining sector, fueled in part by companies' push to secure supplies of copper, a key component in sectors from data centers to electric vehicles.

In September, Anglo American and Teck Resources agreed to a merger that will create one of the world's biggest copper producers in one of the largest-ever deals in the mining industry.

Write to Megan Cheah at megan.cheah@wsj.com

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SentinelOne Price Target Maintained With a $21.00/Share by Needham

Dow Jones Newswires

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The 5 Most Interesting Analyst Questions From SentinelOne’s Q3 Earnings Call

Stock Story

SentinelOne’s third quarter was marked by solid top-line growth and improving profitability, but the market responded negatively to the results. Management attributed the company’s performance to strong customer adoption of its emerging AI, data, and cloud security offerings, as well as greater expansion among existing clients. CEO Tomer Weingarten emphasized the rapid uptake of the Purple AI and data solutions, which contributed to a record average recurring revenue per customer and demonstrated the platform’s differentiation. The quarter also featured continued strength in international markets and meaningful progress in operational efficiency.

Is now the time to buy S? Find out in our full research report (it’s free for active Edge members).

SentinelOne (S) Q3 CY2025 Highlights:

Revenue: $258.9 million vs analyst estimates of $256.1 million (22.9% year-on-year growth, 1.1% beat)
Adjusted EPS: $0.07 vs analyst estimates of $0.05 (31.5% beat)
Adjusted Operating Income: $17.67 million vs analyst estimates of $10.2 million (6.8% margin, 73.2% beat)
Revenue Guidance for Q4 CY2025 is $271 million at the midpoint, below analyst estimates of $273.2 million
Operating Margin: -28.3%, up from -42.3% in the same quarter last year
Customers: 1,572 customers paying more than $100,000 annually
Annual Recurring Revenue: $1.06 billion vs analyst estimates of $1.05 billion (22.8% year-on-year growth, in line)
Billings: $281.6 million at quarter end, up 36.6% year on year
Market Capitalization: $5.18 billion

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From SentinelOne’s Q3 Earnings Call

Saket Kalia (Barclays) asked which non-endpoint products are driving new business. CEO Tomer Weingarten identified data solutions and Purple AI as leading contributors, with Flex licensing enabling broader adoption.
John DiFucci (Guggenheim) questioned the cautious revenue guidance. CFO Barbara Larson explained it was due to prudent assumptions on deal timing and macroeconomic uncertainty, affirming commitment to steady execution.
Brian Essex (JPMorgan) inquired about factors behind gross margin compression. Larson cited investments in cloud infrastructure and global expansion as drivers, with margins expected to remain in the high 70s.
Meta Marshall (Morgan Stanley) sought details on Flex deal momentum. Weingarten described Flex as key to landing larger, multi-solution deals and improving ARR per customer.
Adam Tindle (RJF) referenced a competitor’s claims of partner displacements. Weingarten countered that SentinelOne’s partner ecosystem remains robust, with significant multi-year commitments and no meaningful disruption observed.

Catalysts in Upcoming Quarters

Looking ahead, the StockStory team will be tracking (1) adoption rates and revenue contributions from emerging AI, data, and cloud security products, (2) the effectiveness of the Flex licensing model in driving larger multi-product deals, and (3) the impact of ongoing investments in cloud infrastructure and recent acquisitions on both growth and operating margins. Leadership continuity and successful execution through the CFO transition will also be closely monitored.

SentinelOne currently trades at $15.19, down from $17.10 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free for active Edge members).

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