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Palo Alto Networks (PANW) Declines More Than Market: Some Information for Investors

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Palo Alto Networks (PANW - Free Report) ended the recent trading session at $197.58, demonstrating a -3.45% change from the preceding day's closing price. This change lagged the S&P 500's daily loss of 0.11%. At the same time, the Dow added 0.91%, and the tech-heavy Nasdaq lost 0.82%.

Heading into today, shares of the security software maker had gained 5.02% over the past month, lagging the Computer and Technology sector's gain of 8.76% and the S&P 500's gain of 5.17%.

The upcoming earnings release of Palo Alto Networks will be of great interest to investors. The company is expected to report EPS of $0.88, up 17.33% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $2.5 billion, indicating a 14.17% increase compared to the same quarter of the previous year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $3.27 per share and revenue of $9.19 billion, indicating changes of +15.14% and +14.42%, respectively, compared to the previous year.

Investors should also pay attention to any latest changes in analyst estimates for Palo Alto Networks. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.03% increase. At present, Palo Alto Networks boasts a Zacks Rank of #3 (Hold).

In terms of valuation, Palo Alto Networks is presently being traded at a Forward P/E ratio of 62.51. This indicates a discount in contrast to its industry's Forward P/E of 77.1.

Also, we should mention that PANW has a PEG ratio of 3.06. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Security industry had an average PEG ratio of 3.18 as trading concluded yesterday.

The Security industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 25, putting it in the top 11% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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