Qualys Inks Container Security Deal With Google Cloud; Street Sees 26% Upside

Qualys announced that it has teamed up with Google Cloud to provide out-of-the-box security support for its artifact registry, which is used to store and manage container images and language packages.

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As part of the new integration, security and DevOps teams can set up automated security scans of container artifacts in Google Cloud’s artifact registry. Qualys’ (QLYS) container security scanning will assess all images for software inventory, vulnerabilities and misconfigurations, and provide a unified view across multiple Google Cloud regions, the company said.

Containers are a packaging tool to get software to run efficiently when moved from one computing environment to another. This could be from a developer’s laptop to a test environment, from a staging environment into production, or from a physical machine in a data center to a virtual machine in a private or public cloud. Qualys provides cloud security services that protects systems from cyberattacks and has over 15,700 active customers in more than 130 countries.

“Google (GOOGL) Cloud’s Artifact Registry provides a convenient fully-managed service that allows customers to have a central repository for all their software artifacts,” said Qualys CEO Philippe Courtot. “Now, with our new integration, customers can quickly adopt this artifact management offering from Google Cloud in their DevOps pipeline with seamless container security built-in from Qualys.”

Qualys explained that container software supply chain has become an area of concern for security teams in large and small businesses because developers often make use of container images from a variety of public repositories. A single insecure container image can be instantiated several times and lead to a wide, diffused cyberattack, the company added.

Earlier this month, Needham analyst Alex Henderson reiterated a Buy rating on the stock with a $118 price target, saying that Qualys is a solid growth company with exceptional margins and cash Flow in a high priority sector, but still needs to deliver accelerated growth.

“Its built out a strong cloud platform, its seeing good early uptake metrics like an 80% yr-yr growth in paying Cloud Agent subscriptions, but Revenue growth of 11%-12% is not going to provide the catalyst for meaningful upward multiple revision,” Henderson commented in a note to investors. “Moreover, as Qualys is increasingly competing as a Cloud Security platform, it increasingly is going to run up against very high growth and larger companies such as CrowdStrike and SentinelOne. Scale matters in this competition.” (See QLYS stock analysis on TipRanks)

The rest of the Street is cautiously optimistic on the stock. The Moderate Buy analyst consensus is split into 3 Buys, 2 Holds and 1 Sell. With shares up 9.2% year-to-date, the average analyst price target stands at $114.50, implying upside potential of 26% to current levels.