Palo Alto Networks (PANW) closed the latest trading day at $179.02, indicating a +1.69% change from the previous session's end. The stock's change was more than the S&P 500's daily gain of 0.74%. On the other hand, the Dow registered a gain of 0.05%, and the technology-centric Nasdaq increased by 1.26%.
The security software maker's shares have seen an increase of 0.92% over the last month, surpassing the Computer and Technology sector's loss of 6.23% and the S&P 500's loss of 4.77%.
Analysts and investors alike will be keeping a close eye on the performance of Palo Alto Networks in its upcoming earnings disclosure. In that report, analysts expect Palo Alto Networks to post earnings of $0.77 per share. This would mark year-over-year growth of 16.67%. Simultaneously, our latest consensus estimate expects the revenue to be $2.27 billion, showing a 14.62% escalation compared to the year-ago quarter.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $3.22 per share and a revenue of $9.16 billion, indicating changes of +13.38% and +14.13%, respectively, from the former year.
It is also important to note the recent changes to analyst estimates for Palo Alto Networks. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. 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, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.08% upward. Palo Alto Networks presently features a Zacks Rank of #3 (Hold).
In terms of valuation, Palo Alto Networks is currently trading at a Forward P/E ratio of 54.61. This expresses a discount compared to the average Forward P/E of 61.7 of its industry.
Meanwhile, PANW's PEG ratio is currently 2.73. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Security stocks are, on average, holding a PEG ratio of 3.17 based on yesterday's closing prices.
The Security industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 72, putting it in the top 30% of all 250+ industries.
The Zacks Industry Rank is ordered 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.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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Palo Alto Networks, Inc. (PANW): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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