Palo Alto Networks (PANW) Gains As Market Dips: What You Should Know
Palo Alto Networks (PANW) closed at $175.65 in the latest trading session, marking a +1.04% move from the prior day. This change outpaced the S&P 500's 0.2% loss on the day. Elsewhere, the Dow lost 0.14%, while the tech-heavy Nasdaq lost 0.12%.
Prior to today's trading, shares of the security software maker had lost 1.7% over the past month. This has was narrower than the Computer and Technology sector's loss of 4.64% and the S&P 500's loss of 3.29% in that time.
Investors will be hoping for strength from Palo Alto Networks as it approaches its next earnings release. The company is expected to report EPS of $0.68, up 23.64% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $1.55 billion, up 24% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $3.15 per share and revenue of $6.87 billion, which would represent changes of +25% and +24.87%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Palo Alto Networks. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.
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. Within the past 30 days, our consensus EPS projection has moved 4.57% lower. Palo Alto Networks is currently a Zacks Rank #3 (Hold).
Looking at its valuation, Palo Alto Networks is holding a Forward P/E ratio of 55.12. This valuation marks a premium compared to its industry's average Forward P/E of 41.31.
We can also see that PANW currently has a PEG ratio of 1.75. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Security was holding an average PEG ratio of 2.52 at yesterday's closing price.
The Security industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 65, putting it in the top 26% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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