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SCWX - SecureWorks: Low Multiple But Lack Of Growth Keeps Me On Hold
SecureWorks Corp.
As one of the largest MSSPs (Managed Security Service Providers) out there, SecureWorks (SCWX) offers investors exposure to growth in the security outsourcing space. But even though FQ2 results were strong at first glance, the guidance miss highlights many of the drawbacks to the long-term outlook. Not only has the growth outlook slowed considerably (the latest FQ3 guide calls for Y/Y revenue declines), but there's also uncertainty around execution and headwinds in security consulting amid a challenging macro backdrop. Even at c. 1.5x fiscal 2021 revenue, I am cautious on SCWX shares.