Does IronNet Stock Rally Leave Room for More?

Thanks to the acceleration of digital transformation, and migration towards the cloud, shares of cybersecurity firm IronNet (IRNT) have headed north since it was listed on the exchange. 

Notably, IronNet stock began trading on the New York Stock Exchange on August 27, and has risen about 130% since then.

Growing cyberattacks amid ongoing digital transformations are fueling demand for IronNet’s offerings, and driving its stock higher. I have a bullish outlook on IronNet. (See IronNet stock charts on TipRanks)

Highlighting the increase in cyberattack incidents, IronNet’s co-CEO, Keith Alexander, stated that IronNet’s platform provides “real time exchange of cyber event information and online collaboration for a radically improved defense.”

Thanks to favorable industry trends, IronNet’s ARR (annual recurring revenue) increased by 24% year-over-year to $24.1 million in Q2. Furthermore, its customer count increased to 51 from 22 in the prior-year period. 

However, its operating loss widened, while its calculated billings declined to $3.5 million compared to $7.4 million in the prior year.

Nevertheless, the company stated that the momentum in new customers remains strong so far in the second half of FY22. Furthermore, the company expects to double its ARR in Q3, on the back of its cloud-focused business, large new customer contracts, and increasing market recognition.

Owing to strength in its cloud-based subscription revenue, IronNet expects to deliver revenues of $43 million to $45 million in FY22. Moreover, it projects an ARR of $75 million at the end of FY22. 

Thanks to the strong outlook, investors’ interest in IronNet stock remains elevated. TipRanks’ Stock Investors tool indicates that investors currently have a Very Positive outlook on IronNet stock, with 27.2% of investors who hold portfolios on TipRanks increasing their exposure over the past seven days.

Further, IRNT scores a 9 out of 10 on TipRanks’ Smart Score rating system, indicating that it has strong potential to outperform market expectations.

Disclosure: On the date of publication, Amit Singh had no position in any of the companies discussed in this article.

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