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Palo Alto Networks (PANW) Gains As Market Dips: What You Should Know

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In the latest close session, Palo Alto Networks (PANW - Free Report) was up +1.04% at $190.85. The stock's performance was ahead of the S&P 500's daily loss of 0.19%. Meanwhile, the Dow experienced a drop of 0.8%, and the technology-dominated Nasdaq saw a decrease of 0.1%.

The stock of security software maker has risen by 1.61% in the past month, lagging the Computer and Technology sector's gain of 2.62% and the S&P 500's gain of 2.26%.

Market participants will be closely following the financial results of Palo Alto Networks in its upcoming release. The company's upcoming EPS is projected at $0.93, signifying a 14.81% increase compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $2.58 billion, indicating a 14.33% increase compared to the same quarter of the previous year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $3.84 per share and revenue of $10.52 billion. These totals would mark changes of +14.97% and +14.1%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Palo Alto Networks. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.06% downward. Palo Alto Networks is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Palo Alto Networks has a Forward P/E ratio of 49.17 right now. This expresses a discount compared to the average Forward P/E of 53.12 of its industry.

We can additionally observe that PANW currently boasts a PEG ratio of 2.44. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As of the close of trade yesterday, the Security industry held an average PEG ratio of 2.81.

The Security industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 89, which puts it in the top 37% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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