Stephens has reduced its price target for Check Point Software (NASDAQ: CHKP) to $210.00 from $240.00 while maintaining an Overweight rating after the company released fourth-quarter 2025 results. At the time of the report, the stock was trading at $171.20, well below its 52-week high of $234.35. An InvestingPro Fair Value model referenced alongside the results suggests Check Point may be slightly undervalued.
The research note from Stephens described the quarter as mixed. Billings were robust, but product revenue disappointed. The firm highlighted that product revenue was affected by a shift in the mix - a larger proportion of appliance sales were being allocated to subscriptions - and product bookings came in below the firm's expectations. Despite those headwinds, Check Point retained very strong gross profit margins averaging nearly 88% over the last twelve months.
On the subscription front, Check Point delivered better-than-anticipated results. Subscription revenue outperformed and showed signs of improved growth, and company guidance for 2026 points to further acceleration in that area. In aggregate, the company’s 2026 revenue and operating margin guidance were largely in line with expectations, according to Stephens.
Stephens’ decision to lower the price target reflects somewhat reduced conviction in how quickly improvement will occur, though the firm stated its broader investment thesis remains intact. The revised target is anchored to a valuation of 15.5x enterprise value to forward free cash flow. The research firm had recently moved to an upgraded stance on the stock on the view that fundamentals would build confidence in an improving growth trajectory through 2026.
Additional detail from Check Point’s reported fourth-quarter 2025 results provides a mixed picture. The company posted adjusted earnings per share of $3.40, ahead of the consensus forecast of $2.76. Revenue for the quarter was $744.9 million, slightly below the Street estimate of $746.33 million. Product revenue totaled $171.8 million, a modest 0.7% year-over-year increase, and fell short of analyst expectations.
Industry analyst reactions were varied. FBN Securities and Cantor Fitzgerald trimmed their price targets to $200 and $190, respectively. FBN kept an Outperform rating, while Cantor held a Neutral rating. BTIG reiterated a Neutral stance after reviewing the company’s results and 2026 outlook.
Other operating metrics released for the quarter included billings of $1,039 million, an 8.3% increase year-over-year and above Street expectations. Despite stronger billings, Check Point’s operating income missed BTIG’s forecast by 2.6%.
Over the trailing twelve months, Check Point reported steady revenue growth of 6.31%. Stephens’ updated valuation and the spectrum of analyst reactions reflect the market’s balancing of resilient subscription trends and billing strength against softer product performance and slower-than-expected product bookings.