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In the latest market close, Palo Alto Networks (PANW) reached $152.31, with a -0.82% movement compared to the previous day. This change lagged the S&P 500's daily loss of 0.23%. Meanwhile, the Dow experienced a drop of 0.91%, and the technology-dominated Nasdaq saw an increase of 0.1%.
Prior to today's trading, shares of the security software maker had lost 15.12% over the past month. This has was narrower than the Computer and Technology sector's loss of 16.18% and lagged the S&P 500's loss of 12.13% in that time.
Investors will be eagerly watching for 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%. Meanwhile, our latest consensus estimate is calling for revenue of $2.28 billion, up 14.63% from the prior-year quarter.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $3.22 per share and a revenue of $9.17 billion, representing changes of +13.38% and +14.2%, respectively, from the prior year.
Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Palo Alto Networks. Recent revisions tend to reflect the latest near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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, there's been a 0.21% fall in the Zacks Consensus EPS estimate. At present, Palo Alto Networks boasts a Zacks Rank of #3 (Hold).
In the context of valuation, Palo Alto Networks is at present trading with a Forward P/E ratio of 47.67. For comparison, its industry has an average Forward P/E of 52.27, which means Palo Alto Networks is trading at a discount to the group.
One should further note that PANW currently holds a PEG ratio of 2.38. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. Security stocks are, on average, holding a PEG ratio of 2.65 based on yesterday's closing prices.