CyberArk and Centene have been highlighted as Zacks Bull and Bear of the Day

Globe and Mail

24-07-2025

For Immediate Release
Chicago, IL – July 24, 2025 – Zacks Equity Research shares CyberArk CYBR as the Bull of the Day and Centene Corp. CNC as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Palantir Technologies PLTR, Lockheed Martin LMT and RTX Corp. RTX.
Here is a synopsis of all five stocks.
Bull of the Day:
CyberArk is a $19 billion provider of cybersecurity solutions to more than 5,400 global businesses, including over half of the Fortune 500 and over 35% of Global 2000 companies.
CYBR specializes in Privileged Access Management (PAM), which allows businesses to secure, manage, and monitor identities (human, machine, and now agentic) that have elevated or "privileged" access to critical systems and sensitive data.
Since 2022 when I became a CYBR investor, my rationale has centered on two themes: (1) threat actors were becoming more sophisticated and well-funded to perform larger attacks on enterprises and (2) AI and other automation tools would multiply and accelerate their malicious efforts exponentially.
So I'm excited to see CYBR finding more ways to use AI to their advantage in a never-ending war of threats. Here's what their 2025 report Identity Security Landscape had to say about the challenge...
"Organizations now report that 72% of employees regularly use AI tools on the job -- yet 68% of respondents still lack identity security controls for these technologies. Machine identities now outnumber human identities by more than 80 to 1."
Securing AI Agents
In Q1 of 2025, CyberArk introduced its Secure AI Agents Solution to help organizations manage the privileged access of AI agents and secure their interactions across environments. The solution combined CyberArk's existing platform capabilities with AI-specific discovery, privilege controls, lifecycle management and governance.
With the explosion of "agentic" AI this year -- where software programs with specific goals can act autonomously on your behalf to execute tasks -- the risks have soared in the identity security realms. AI agents can act like humans in their autonomy and like machines in their ability to scale, creating a unique security risk.
They can communicate with other agents, access sensitive systems and even modify their behavior to complete complex tasks, making them a fast-growing security risk as organizations scale their use of AI. Millions of autonomous, unpredictable AI agents represent a new, rapidly expanding identity security attack surface.
CyberArk's solutions address this challenge by applying identity-first security principles, where it treats each AI agent like any other privileged, autonomous identity. The solution provides organizations with visibility into all AI agents, including known or shadow agents. It also enforces privilege control for secure access management and threat detection and response.
AWS Marketplace AI Agents and Tools
Again from the CYBR Identity Security Landscape report...
"In the race to adopt AI, organizations are also inadvertently creating a surge of unmanaged and unsecured machine identities that overburdened teams don't have the visibility to manage. The privileged access of AI agents represents an entirely new threat vector that existing security models aren't built to handle."
On July 16, CyberArk expanded access to these capabilities by making Secure Cloud Access MCP Server and Agent Guard available through Amazon Web Service ("AWS") Marketplace. Through these offerings, CyberArk aims to simplify the adoption and enforcement of Zero Standing Privileges across AI workflows, further strengthening CyberArk's platform reach.
Customers can now use AWS Marketplace to easily discover, buy, and deploy AI agent solutions using their AWS accounts, accelerating agent and agentic workflow development.
The Growth Outlook Brightens
While estimates did not rise in the past week since this announcement, I expect them to and we'll learn more at the company's Q2 earnings report on August 7. On July 14, Barclays raised their price target on CYBR shares to $440.
CYBR is projected to grow revenues this year by 32% to cross $1.3 billion. And profits are hopping too with an expected 26.4% advance to EPS of $3.83.
A key driver of this growth is CyberArk's ability to carry out cross-selling synergies among its existing customer base. Existing customers are adopting more solutions from CyberArk's platform, which is helping grow subscription revenues.
As more enterprises adopt AI agents, CyberArk's early move into this space could create new cross-sell opportunities, making its platform even more critical for customers seeking identity security consolidation.
For instance, A Fortune 100 financial services firm, which is a long-time CyberArk customer on the human identity side, expanded into certificate lifecycle management and Public Key Infrastructure (PKI) offerings with a competitive multi-six-figure Annual Contract Value (ACV) deal.
I'm looking forward to the August 7 company report to learn more.
Disclosure: I own shares of CYBR for the Zacks TAZR Trader portfolio.
Bear of the Day:
Centene Corp., a giant of managed care expected to cross $175 billion in revenues this year, unexpectedly pulled its earnings guidance for 2025 on July 2. This change came after an unexpected shift in the dynamics of the health Insurance Marketplace, which could impact earnings more significantly than what was initially forecasted.
The decision followed industry risk adjustment data from the independent actuarial firm Wakely, which analyzed 22 out of Centene's 29 Marketplace states, representing approximately 72% of its Marketplace membership. According to the company, these data showed higher-than-expected overall market morbidity and a slower pace of market growth.
CNC is anticipating a shortfall of about $1.8 billion in net risk adjustment revenues, which would mean a $2.75 impact on adjusted diluted EPS for 2025. Although it does not have data from the other seven states, management anticipates a further decline in risk-adjusted revenues due to similar morbidity trends.
Since the revelation, Wall Street analysts slashed their EPS projection for this year, cutting the Zacks profit consensus in half from $7.29 to $3.55 and discounting more of the unknowns.
The Good, the Bad, and the Ugly
Despite headwinds, CNC shared that the final 2024 risk-adjusted results from the Centers for Medicare and Medicaid Services aligned with their expectations, and its Medicare Advantage and Medicare PDP segments are performing better than its expectations in the second quarter of 2025. However, Medicaid is facing challenges due to rising costs in behavioral health, home care and expensive medications, particularly in states like New York and Florida.
As we look toward 2026, Centene is taking proactive steps to adjust its rates, aiming to account for a higher morbidity baseline. This adjustment is seen as a necessary move to help balance out potential losses. The company plans to make these pricing changes in the states where it conducts most of its marketplace business. The early refiling of 2026 rates by CNC suggests a more defensive pricing approach in the future.
Typical of many Wall Street investment banks, Wells Fargo downgraded CNC shares to Equal-Weight and cut their price target from $72 to $30.
A close look at second-quarter earnings and data analysis is required to move forward. CNC's second-quarter 2025 results are slated to be released on Friday July 25.
Additional content:
Palantir's Current Valuation Stretch or Fully Justified?
Palantir Technologies has emerged as one of the most talked-about names in the S&P 500, and not just for what it does, but for what investors are willing to pay for it. With a market capitalization of $358 billion, it now surpasses giants like Coca-Cola and Bank of America. Yet, when viewed through a valuation lens, Palantir stands alone in its league.
Its trailing 12-month price-to-earnings ratio exceeds 640X, and its forward 12-month multiple hovers above 225X. Even more striking is its enterprise value relative to forward 12-month revenue of more than 78X, a level rarely seen, even during the most exuberant periods in market history. By that metric, Palantir looks far more expensive than nearly every other established U.S. stock over the past two decades.
Such elevated valuations raise the bar for future performance. For a company trading at these levels, expectations around revenue acceleration, margin expansion, and long-term scalability must not only be met; they must be exceeded. Even minor disappointments can trigger sharp corrections as multiples revert toward historical norms. Companies in the past that reached these kinds of revenue multiples — often 30x or higher — eventually faced tough questions about sustainability. Investor optimism alone is rarely enough to sustain prices when fundamentals don't keep up.
The pattern is hard to ignore. When companies reach 30x sales or more, they often enter what is viewed as the 'bubble zone,' a place where expectations are sky-high and hard to maintain. Revenue growth typically slows, forecasts get downgraded and valuations eventually compress. In the short term, momentum can mask this risk, but over time, gravity tends to take hold.
In conclusion, Palantir's valuation not only defies market norms but also places it well beyond even the exuberance seen in past bubbles. Unless its performance can defy history, the risk of multiple compression looms large. Investors should tread carefully.
Stable Defense Alternatives to Palantir
As PLTR's valuation moves higher, Lockheed Martin and RTX Corp. offer more grounded defense exposure. Lockheed Martin, with its massive defense contracts, provides steady cash flow and less volatility than PLTR. Its trailing 12-month price-to-earnings ratio is below 18X, and its forward 12-month multiple is just above 14X. Lockheed Martin continues to benefit from global rearmament while trading at modest earnings multiples.
Similarly, RTX shines through missile systems. RTX's defense backlog, like LMT's, underscores its stability. Its trailing 12-month price-to-earnings ratio is below 44X, and its forward 12-month multiple is just above 23X.
PLTR's Price Performance, Estimates
The stock has surged a whopping 97% year to date, significantly outperforming the industry 's 19% rally.
The Zacks Consensus Estimate for PLTR's earnings has remained unchanged over the past 30 days.
PLTR stock currently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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Lockheed Martin Corporation (LMT): Free Stock Analysis Report
Centene Corporation (CNC): Free Stock Analysis Report
CyberArk Software Ltd. (CYBR): Free Stock Analysis Report
RTX Corporation (RTX): Free Stock Analysis Report
Palantir Technologies Inc. (PLTR): Free Stock Analysis Report
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