Fast-growing cybersecurity platform SentinelOne (S) generated triple-digit revenue growth in its last reported quarter, driven by new and existing customers. However, given the company’s steep losses and lofty valuation, will the stock be a risky play in a competitive cybersecurity industry? Read on. Let’s find out.Cybersecurity startup SentinelOne, Inc. (S) in Mountain View, Calif., is a pioneer in offering artificial intelligence-powered autonomous threat prevention and detection to help organizations secure their assets. Shares of the cybersecurity company have risen 12.9% since its stock market debut on June 30, 2021, on the back of solid growth in its customer base and its expanded global footprint. However, S’ stock price has been down 34.9% over the past month.
While the security-software company reported better-than-expected growth in revenue in the third quarter of its fiscal 2022, its widening losses are alarming. Furthermore, S’ negative margins and growing operational expenses may prevent it from catching up with its larger peers.
Growing competition from larger cybersecurity rivals like CrowdStrike Holdings (NASDAQ:CRWD) and the company’s lofty valuation could keep investors on edge.