Palo Alto Networks (PANW) Gains As Market Dips: What You Should Know
In the latest trading session, Palo Alto Networks (PANW) closed at $178.99, marking a +1% move from the previous day. The stock outpaced the S&P 500's daily loss of 1.54%. Elsewhere, the Dow lost 1.49%, while the tech-heavy Nasdaq lost 2.17%.
Coming into today, shares of the security software maker had gained 6.92% in the past month. In that same time, the Computer and Technology sector lost 4.64%, while the S&P 500 lost 6.77%.
PANW will be looking to display strength as it nears its next earnings release, which is expected to be February 25, 2019. The company is expected to report EPS of $1.22, up 41.86% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $682.44 million, up 25.82% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.19 per share and revenue of $2.79 billion. These totals would mark changes of +30.08% and +22.87%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for PANW. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 17.1% higher within the past month. PANW is currently a Zacks Rank #3 (Hold).
Investors should also note PANW's current valuation metrics, including its Forward P/E ratio of 34.14. Its industry sports an average Forward P/E of 46.2, so we one might conclude that PANW is trading at a discount comparatively.
Investors should also note that PANW has a PEG ratio of 1.46 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Security stocks are, on average, holding a PEG ratio of 2.52 based on yesterday's closing prices.
The Security industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 17, which puts it in the top 7% 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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