In the latest trading session, Palo Alto Networks (PANW) closed at $163.17, marking a +0.99% move from the previous day. The stock outpaced the S&P 500's daily loss of 1.03%. Elsewhere, the Dow lost 1.11%, while the tech-heavy Nasdaq lost 0.12%.
Coming into today, shares of the security software maker had lost 13.55% in the past month. In that same time, the Computer and Technology sector lost 13.11%, while the S&P 500 lost 10.4%.
Wall Street will be looking for positivity from Palo Alto Networks as it approaches its next earnings report date. The company is expected to report EPS of $0.68, up 23.64% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales 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.
Investors might also notice recent changes to analyst estimates for Palo Alto Networks. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. Within the past 30 days, our consensus EPS projection has moved 0.11% lower. Palo Alto Networks is currently a Zacks Rank #3 (Hold).
In terms of valuation, Palo Alto Networks is currently trading at a Forward P/E ratio of 51.28. This represents a premium compared to its industry's average Forward P/E of 40.01.
Investors should also note that PANW has a PEG ratio of 1.63 right now. 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 industry currently had an average PEG ratio of 2.34 as of yesterday's close.
The Security industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 64, which puts 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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