AI-based cybersecurity firm SentinelOne may have turned a corner. On Monday the Relative Strength (RS) Rating for SentinelOne stock climbed to 81, up from 78.
Mountain View, Calif.-based SentinelOne says on its website that it is "The first security AI platform to protect the entire enterprise." In other words its provides protection from the edge of the network all the way up to the cloud.
The upgraded 81 Relative Strength Rating puts it in the top 19% of all stocks for price performance over the past year. Market research shows that the top-performing stocks often have an RS Rating of at least 80 in the early stages of their biggest gains.
SentinelOne Stock Popped, Dropped, Rebounded
The artificial intelligence-based cybersecurity company went public in June 30, 2021, amid the pandemic. It ended its first day trading at 42.50. Its stock rose to 78.53 in mid-November that year and it began forming its first post-IPO base.
After its early post-IPO high, SentinelOne stock steadily declined until recently as it formed what could be the left side of a long cup base. On June 6 this year it bottomed at 12.43 a share. From there it's risen steadily and traded at about 17.30 Monday afternoon, up fractionally for the day and up nearly 40% from the June bottom.
SentinelOne stock is on track to have risen six of the past seven trading sessions. Additionally, unlike some companies still battered by the recent market correction, it trades above both its 50-day and 200-day lines.
The company's other ratings confirm that this stock is one to watch. It has an 81 Composite Rating out of 99. Its B- Accumulation/Distribution Rating shows that institutional investors like insurance funds and mutual funds are buying more of its shares than selling.
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Additionally, the number of funds holding SentinelOne stock has risen steadily this year, from 366 in the December 2022-ended quarter to 424 in September. The only yellow flag is its weak 51 Earnings Per Share Rating, reflecting its continued earnings weakness. Look for the company to put up positive earnings.
SentinelOne says on its website it expects to report third quarter performance numbers after the market closes on Dec. 5.
Sales Grow Like A Weed, Earnings Improve
In terms of fundamentals, SentinelOne reported an 8 cents per share loss last quarter, improved from a 20-cent loss the same quarter a year earlier. Although the company isn't profitable yet its EPS growth rate has improved over the past three quarters. Meanwhile, its sales growth has been going gangbusters, ranging from 46% to 106% over the past four quarters. Last quarter sales grew 46% to $149.4 million.
SentinelOne stock earns the No. 14 rank among its peers in the 34-stock Computer Software-Security industry group. Qualys and Zscaler are among the group's highest-rated stocks.
When researching the best stocks to buy and watch, a stock's relative price strength vs. other stocks is a key indicator.
IBD's proprietary Relative Strength Rating identifies price movement with a 1 (worst) to 99 (best) score. The grade shows how a stock's price performance over the last 52 weeks holds up against all the other stocks in our database.
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