Tenable Holdings, Inc. (NASDAQ:TENB) is a cybersecurity company that specializes in vulnerability management. It provides solutions to help organizations identify and manage cybersecurity risks. In the competitive landscape, Tenable faces peers like Rapid7, Varonis Systems, Qualys, Elastic N.V., and Smartsheet, each offering unique cybersecurity and data management solutions.
Tenable's ROIC is -0.97%, which is below its WACC of 7.12%. This negative ROIC indicates that Tenable is not generating sufficient returns to cover its cost of capital. This is a concern for investors as it suggests inefficient capital utilization. In comparison, Rapid7 has a positive ROIC of 0.79% against a WACC of 5.36%, showing better capital efficiency.
Varonis Systems presents a strong performance with a ROIC of 9% and a WACC of 6.18%. This results in a ROIC to WACC ratio of 1.45, indicating effective capital use. Qualys, however, leads the pack with a ROIC of 28% and a WACC of 6.32%, resulting in a ROIC to WACC ratio of 4.42, highlighting its superior capital efficiency.
Elastic N.V. and Smartsheet, like Tenable, have negative ROICs. Elastic's ROIC is -64.50% with a WACC of 7.88%, and Smartsheet's ROIC is -2.84% with a WACC of 7.92%. These figures suggest that both companies, along with Tenable, are struggling to generate returns above their cost of capital, which could be a red flag for potential investors.
