U.S. Markets closed

Palo Alto Networks (PANW) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Palo Alto Networks (PANW) closed at $225.02 in the latest trading session, marking a +0.48% move from the prior day. This move outpaced the S&P 500's daily gain of 0.47%. Elsewhere, the Dow lost 0.29%, while the tech-heavy Nasdaq added 0.85%.

Heading into today, shares of the security software maker had gained 12.8% over the past month, outpacing the Computer and Technology sector's gain of 2.8% and the S&P 500's gain of 2.08% in that time.

PANW will be looking to display strength as it nears its next earnings release. In that report, analysts expect PANW to post earnings of $1.42 per share. This would mark year-over-year growth of 10.94%. Our most recent consensus estimate is calling for quarterly revenue of $803.06 million, up 22.03% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.40 per share and revenue of $2.90 billion, which would represent changes of +35.34% and +27.38%, respectively, from the prior year.

Any recent changes to analyst estimates for PANW should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about 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. Within the past 30 days, our consensus EPS projection remained stagnant. PANW is currently a Zacks Rank #3 (Hold).

In terms of valuation, PANW is currently trading at a Forward P/E ratio of 41.51. This represents a no noticeable deviation compared to its industry's average Forward P/E of 41.51.

We can also see that PANW currently has a PEG ratio of 1.77. 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 2.45 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 106, which puts it in the top 42% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Palo Alto Networks, Inc. (PANW) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.