SecureWorks (NasdaqGS:SCWX) - Share price, News & Analysis

SCWX fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	0/6
Past Performance	0/6
Financial Health	6/6
Dividends	0/6

SCWX Stock Overview

SecureWorks Corp., through its subsidiaries, provides technology-driven information security solutions for protecting its customers in the United States and internationally.

Risk Analysis

Earnings are forecast to decline by an average of 29.3% per year for the next 3 years

Currently unprofitable and not forecast to become profitable over the next 3 years

SecureWorks Competitors

Appgate

OTCPK:APGT

US$988.5m

A10 Networks

NYSE:ATEN

US$1.0b

Zuora

NYSE:ZUO

US$1.2b

N-able

NYSE:NABL

US$1.6b

Price History & Performance

Summary of all time highs, changes and price drops for SecureWorks
Historical stock prices
Current Share Price	US$10.93
52 Week High	US$26.89
52 Week Low	US$9.26
Beta	1
1 Month Change	-6.74%
3 Month Change	-17.45%
1 Year Change	-47.04%
3 Year Change	-9.82%
5 Year Change	4.00%
Change since IPO	-21.93%

Shareholder Returns

	SCWX	US Software	US Market
7D	-2.3%	-3.1%	-2.2%
1Y	-47.0%	-23.6%	-19.1%

Return vs Industry: SCWX underperformed the US Software industry which returned -23.6% over the past year.

Return vs Market: SCWX underperformed the US Market which returned -21.2% over the past year.

Price Volatility

Is SCWX's price volatile compared to industry and market?
SCWX volatility
SCWX Average Weekly Movement	8.2%
Software Industry Average Movement	11.0%
Market Average Movement	8.1%
10% most volatile stocks in US Market	16.9%
10% least volatile stocks in US Market	3.3%

Stable Share Price: SCWX is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: SCWX's weekly volatility (8%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1999	2,351	Wendy Thomas	https://www.secureworks.com

SecureWorks Corp., through its subsidiaries, provides technology-driven information security solutions for protecting its customers in the United States and internationally. The company’s solutions include software-as-a-service solutions, managed security services, and professional services, including incident response and security risk consulting services. Its solutions enable organizations to prevent security breaches, detect malicious activity, respond rapidly to security breaches, and identify emerging threats.

SecureWorks Fundamentals Summary

How do SecureWorks's earnings and revenue compare to its market cap?
SCWX fundamental statistics
Market Cap	US$927.51m
Earnings (TTM)	-US$55.00m
Revenue (TTM)	US$516.77m

1.8x

P/S Ratio

-16.9x

P/E Ratio

Is SCWX overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
SCWX income statement (TTM)
Revenue	US$516.77m
Cost of Revenue	US$209.35m
Gross Profit	US$307.41m
Other Expenses	US$362.41m
Earnings	-US$55.00m

Last Reported Earnings

Apr 29, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	-0.65
Gross Margin	59.49%
Net Profit Margin	-10.64%
Debt/Equity Ratio	0%

How did SCWX perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is SCWX undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for SCWX?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for SCWX. This is calculated by dividing SCWX's market cap by their current preferred multiple.
What is SCWX's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$927.51m

SCWX key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1.5x
Enterprise Value/EBITDA	-24.7x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

How does SCWX's PS Ratio compare to its peers?

SCWX PS Ratio vs Peers

The above table shows the PS ratio for SCWX vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	8.2x
APGT Appgate	21.2x	n/a	US$988.5m
ATEN A10 Networks	4x	10.1%	US$1.0b
ZUO Zuora	3.3x	17.5%	US$1.2b
NABL N-able	4.5x	12.2%	US$1.6b
SCWX SecureWorks	1.8x	5.1%	US$927.5m

Forward PS

Price-To-Sales vs Peers: SCWX is good value based on its Price-To-Sales Ratio (1.8x) compared to the peer average (8.2x).

Price to Earnings Ratio vs Industry

How does SCWX's PE Ratio compare vs other companies in the US Software Industry?

Price-To-Sales vs Industry: SCWX is good value based on its Price-To-Sales Ratio (1.8x) compared to the US Software industry average (4.5x)

Price to Sales Ratio vs Fair Ratio

What is SCWX's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

SCWX PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	1.8x
Fair PS Ratio	2.7x

Price-To-Sales vs Fair Ratio: SCWX is good value based on its Price-To-Sales Ratio (1.8x) compared to the estimated Fair Price-To-Sales Ratio (2.7x).

Share Price vs Fair Value

What is the Fair Price of SCWX when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: Insufficient data to calculate SCWX's fair value for valuation analysis.

Significantly Below Fair Value: Insufficient data to calculate SCWX's fair value for valuation analysis.

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate SCWX's PEG Ratio to determine if it is good value.

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Future Growth

How is SecureWorks forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-29.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: SCWX is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: SCWX is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: SCWX is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: SCWX's revenue (5.1% per year) is forecast to grow slower than the US market (8.2% per year).

High Growth Revenue: SCWX's revenue (5.1% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: SCWX is forecast to be unprofitable in 3 years.

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Past Performance

How has SecureWorks performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-7.7%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: SCWX is currently unprofitable.

Growing Profit Margin: SCWX is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: SCWX is unprofitable, and losses have increased over the past 5 years at a rate of 7.7% per year.

Accelerating Growth: Unable to compare SCWX's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: SCWX is unprofitable, making it difficult to compare its past year earnings growth to the Software industry (26.8%).

Return on Equity

High ROE: SCWX has a negative Return on Equity (-8.8%), as it is currently unprofitable.

Discover strong past performing companies

Financial Health

How is SecureWorks's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Stable Cash Runway
Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: SCWX's short term assets ($288.6M) exceed its short term liabilities ($241.0M).

Long Term Liabilities: SCWX's short term assets ($288.6M) exceed its long term liabilities ($68.6M).

Debt to Equity History and Analysis

Debt Level: SCWX is debt free.

Reducing Debt: SCWX had no debt 5 years ago.

Balance Sheet

Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable SCWX has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: SCWX is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 40.8% per year.

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Dividend

What is SecureWorks's current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate SCWX's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate SCWX's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if SCWX's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if SCWX's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as SCWX has not reported any payouts.

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Management

How experienced are the management team and are they aligned to shareholders interests?

2.4yrs

Average management tenure

CEO

Wendy Thomas (49 yo)

0.83

Tenure

US$10,359,440

Compensation

Ms. Wendy K. Thomas serves as President & Chief Executive Officer of Secureworks at Dell Technologies Inc. since 2021. She serves as President & CEO at SecureWorks, Inc. since September 2021. She serves as...

CEO Compensation Analysis

Compensation vs Market: Wendy's total compensation ($USD10.36M) is above average for companies of similar size in the US market ($USD4.04M).

Compensation vs Earnings: Insufficient data to compare Wendy's compensation with company performance.

Leadership Team

Experienced Management: SCWX's management team is considered experienced (2.4 years average tenure).

Board Members

Experienced Board: SCWX's board of directors are considered experienced (6 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: SCWX insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/07/04 00:00
End of Day Share Price	2022/07/01 00:00
Earnings	2022/04/29
Annual Earnings	2022/01/28