BofA upgrades Check Point, downgrades Coursera

Investing.com03-27

Investing.com -- Bank of America upgraded Check Point Software Technologies (NASDAQ:CHKP) to Buy from Neutral, citing strategic changes under new CEO Nadav Zafrir, while resuming coverage of Coursera Inc (NYSE:COUR) with an Underperform rating, pointing to weaker revenue growth and margin pressures.

Check Point Gains Momentum Under New CEO

BofA highlighted that Check Point’s stock has lagged the broader cybersecurity sector in recent years due to reactive R&D, execution missteps, and a challenged go-to-market (GTM) strategy.

But under Zafrir’s leadership, the company is implementing changes that could drive growth.

"We see encouraging signs of new GTM and product initiatives, and place great emphasis on the background and pedigree of CEO Zafrir," the note said.

Zafrir has restructured the GTM strategy by flattening the organization, hiring new sales leadership, and aligning sales incentives with Annual Recurring Revenue (ARR) metrics.

Additionally, BofA expects Check Point to shift from point products to a hybrid mesh platform through organic and inorganic growth.

BofA raised its price target to $260 from $230, citing improved growth prospects and assigning a 21x EV/FCF multiple to 2026 estimates.

Coursera Faces Growth Headwinds, Rated Underperform

Conversely, BofA resumed coverage of Coursera with an Underperform rating, citing a muted 2025 revenue outlook and slower margin improvement.

Management expects revenue from the Degrees segment, which delivered the highest segmental growth in 2024, to decline in 2025.

"A pullback not only hurts revenue but also adversely impacts the company’s margin trajectory," BofA noted, adding that Degrees contributed 8% of 2024 revenue but carried a 100% gross margin.

BofA expects 2025 revenue growth to slow to 4%, down from 9% in 2024, with weakness in North America’s consumer segment and a declining net revenue retention (NRR) rate in the enterprise segment.

Leadership transition, with Greg Hart taking over as CEO from Jeff Maggioncalda in February 2025, may also cause near-term growth challenges.

BofA set a $7 price target, assigning a 0.4x EV/2026 revenue multiple, well below Ed-tech peers at 0.9x, due to Coursera’s weaker growth and margin profile.

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BofA upgrades Check Point, downgrades Coursera

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