Tenable Earnings: Growing TenableOne Usage and Margin Expansion Impress

We are maintaining our $43 fair value estimate for narrow-moat Tenable, after the firm reported first-quarter results largely in line with our revenue expectations, while beating our bottom-line estimates. We remain impressed with the firm’s ability to expand margins while investing to grow its exposure management capabilities. The company raised its 2024 guidance but provided second-quarter targets that were lower than our initial estimates, implying greater upside in the second half of the year, which we think heightens near-term risks. In our view, Tenable is well positioned to capitalize on secular tailwinds toward greater cybersecurity spending and vendor consolidation. We view current shares, which were flat after hours, as fairly valued.