While growth is established for NASDAQ:PANW, the stock's valuation remains reasonable.

Last update: Dec 18, 2024

Take a closer look at PALO ALTO NETWORKS INC (NASDAQ:PANW), an affordable growth stock uncovered by our stock screener. NASDAQ:PANW boasts strong growth prospects and excels in financial health indicators, all while maintaining a reasonable valuation. Let's break it down further.

Assessing Growth for NASDAQ:PANW

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NASDAQ:PANW boasts a 8 out of 10:

The Earnings Per Share has grown by an nice 17.71% over the past year.
Measured over the past years, PANW shows a very strong growth in Earnings Per Share. The EPS has been growing by 25.52% on average per year.
The Revenue has grown by 15.00% in the past year. This is quite good.
The Revenue has been growing by 22.59% on average over the past years. This is a very strong growth!
Based on estimates for the next years, PANW will show a very strong growth in Earnings Per Share. The EPS will grow by 22.97% on average per year.
Based on estimates for the next years, PANW will show a quite strong growth in Revenue. The Revenue will grow by 16.75% on average per year.

Valuation Assessment of NASDAQ:PANW

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NASDAQ:PANW has earned a 5 for valuation:

Compared to the rest of the industry, the Price/Earnings ratio of PANW indicates a somewhat cheap valuation: PANW is cheaper than 71.22% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PANW indicates a somewhat cheap valuation: PANW is cheaper than 73.02% of the companies listed in the same industry.
Based on the Enterprise Value to EBITDA ratio, PANW is valued a bit cheaper than 68.35% of the companies in the same industry.
85.97% of the companies in the same industry are more expensive than PANW, based on the Price/Free Cash Flow ratio.
PANW has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as PANW's earnings are expected to grow with 15.01% in the coming years.

Looking at the Health

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:PANW, the assigned 5 for health provides valuable insights:

PANW has an Altman-Z score of 3.36. This indicates that PANW is financially healthy and has little risk of bankruptcy at the moment.
PANW has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

A Closer Look at Profitability for NASDAQ:PANW

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:PANW scores a 6 out of 10:

PANW's Return On Assets of 13.42% is amongst the best of the industry. PANW outperforms 91.01% of its industry peers.
With an excellent Return On Equity value of 46.25%, PANW belongs to the best of the industry, outperforming 96.04% of the companies in the same industry.
With a decent Return On Invested Capital value of 6.00%, PANW is doing good in the industry, outperforming 78.42% of the companies in the same industry.
PANW has a better Profit Margin (32.99%) than 94.96% of its industry peers.
Looking at the Operating Margin, with a value of 12.10%, PANW belongs to the top of the industry, outperforming 80.58% of the companies in the same industry.
PANW's Gross Margin of 74.17% is fine compared to the rest of the industry. PANW outperforms 63.31% of its industry peers.

Our Affordable Growth screener lists more Affordable Growth stocks and is updated daily.

For an up to date full fundamental analysis you can check the fundamental report of PANW

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.