- Stock trades at over 10x sales with an increasing share count.
- Despite product leadership and market penetration, it has never made a profit.
- Faces competition from larger and better-funded competitors that offer a wider range of products.
- The CEO owns 1 share. Company insiders have sold over $73 million worth of stock as they constantly cash in.
Proofpoint (NASDAQ:PFPT) is a security-as-a-service vendor that delivers data-protection solutions including threat protection, regulatory compliance, data governance and eDiscovery, and secure communication. (Source: Morningstar) Or put simply, it’s a cyber-security company.
Cyber security has generated a lot of interest following the multiple data breaches at some of the largest companies in the world (e.g. Target (NYSE:TGT), UPS (NYSE:UPS), Home Depot (NYSE:HD), JPMorgan (NYSE:JPM), Staples (NASDAQ:SPLS), Sony (NYSE:SNE), Anthem (NYSE:ANTM)). This problem has expanded to social media as reported recently by CNBC here. A scary example from the article:
“Someone tweets at a company because they may be upset about an issue. A fake account on Twitter replies directly to that person, and asks them to log in to a fake website. The victim then exposes their personal information to hackers.”