CyberArk Software Ltd (NASDAQ:CYBR) appears poised to "consolidate identity spending and maintain durable and increasingly profitable growth," according to RBC Capital Markets analyst Matthew Hedberg.

Last month, the company reported upbeat second-quarter results.

Hedberg initiated coverage of CyberArk Software with an Outperform rating and a price target of $328.

The CyberArk Software Thesis: Identity spending remains important as the company is a security vendor and this market is "largely best in class" and could "consolidate somewhat' over time, Hedberg said in the initiation note.

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"We still think there is considerable room to grow within their core PAM market," he added. Once fully integrated, the Venafi acquisition could accelerate growth back to 20%, offering a significant cross-sell opportunity, he added.

CyberArk Software could continue growing at "+20% organically for several years," given the estimated total addressable market (TAM) of $60 billion, the analyst further stated.

CYBR Price Action: Shares of CyberArk Software had risen by 1.31% to $274.78 at the time of publication on Friday.

Read More: Should You Invest in CyberArk Based on Bullish Wall Street Views?