PALO ALTO NETWORKS INC (PANW)
US6974351057 - Common Stock
We assign a fundamental rating of 6 out of 10 to PANW. PANW was compared to 276 industry peers in the Software industry. Both the profitability and the financial health of PANW get a neutral evaluation. Nothing too spectacular is happening here. PANW is valued quite expensive, but it does show an excellent growth. This makes PANW very considerable for growth investing!
1. Profitability
1.1 Basic Checks
In the past year PANW was profitable.
PANW had a positive operating cash flow in the past year.
In the past 5 years PANW reported 4 times negative net income.
Each year in the past 5 years PANW had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 12.45%, PANW belongs to the top of the industry, outperforming 92.70% of the companies in the same industry.
With an excellent Return On Equity value of 52.25%, PANW belongs to the best of the industry, outperforming 97.81% of the companies in the same industry.
PANW's Return On Invested Capital of 5.74% is amongst the best of the industry. PANW outperforms 81.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.45% | ||
| ROE | 52.25% | ||
| ROIC | 5.74% |
ROA(3y)-1.34%
ROA(5y)-1.64%
ROE(3y)-60.19%
ROE(5y)-41.99%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
PANW has a Profit Margin of 30.24%. This is amongst the best in the industry. PANW outperforms 95.62% of its industry peers.
The Operating Margin of PANW (10.33%) is better than 83.21% of its industry peers.
With a decent Gross Margin value of 74.05%, PANW is doing good in the industry, outperforming 66.79% of the companies in the same industry.
PANW's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.33% | ||
| PM (TTM) | 30.24% | ||
| GM | 74.05% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.76%
GM growth 5Y0.19%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), PANW is destroying value.
PANW has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, PANW has more shares outstanding
PANW has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 4.63 indicates that PANW is not in any danger for bankruptcy at the moment.
PANW has a Altman-Z score of 4.63. This is in the better half of the industry: PANW outperforms 68.98% of its industry peers.
PANW has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.62 | ||
| Altman-Z | 4.63 |
ROIC/WACC0.59
WACC9.77%
2.3 Liquidity
A Current Ratio of 0.83 indicates that PANW may have some problems paying its short term obligations.
With a Current ratio value of 0.83, PANW is not doing good in the industry: 85.04% of the companies in the same industry are doing better.
A Quick Ratio of 0.83 indicates that PANW may have some problems paying its short term obligations.
PANW has a Quick ratio of 0.83. This is amonst the worse of the industry: PANW underperforms 83.94% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.83 | ||
| Quick Ratio | 0.83 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 64.36% over the past year.
PANW shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 27.93% yearly.
The Revenue has grown by 22.28% in the past year. This is a very strong growth!
PANW shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 24.83% yearly.
EPS 1Y (TTM)64.36%
EPS 3Y39.45%
EPS 5Y27.93%
EPS growth Q2Q39.05%
Revenue 1Y (TTM)22.28%
Revenue growth 3Y26.46%
Revenue growth 5Y24.83%
Revenue growth Q2Q19.33%
3.2 Future
The Earnings Per Share is expected to grow by 23.50% on average over the next years. This is a very strong growth
PANW is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 18.02% yearly.
EPS Next Y26.96%
EPS Next 2Y19.11%
EPS Next 3Y18.86%
EPS Next 5Y23.5%
Revenue Next Year15.81%
Revenue Next 2Y15.04%
Revenue Next 3Y15.64%
Revenue Next 5Y18.02%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 54.26, PANW can be considered very expensive at the moment.
Based on the Price/Earnings ratio, PANW is valued a bit cheaper than 63.50% of the companies in the same industry.
PANW's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 28.06.
Based on the Price/Forward Earnings ratio of 46.56, the valuation of PANW can be described as expensive.
PANW's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 20.72. PANW is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 54.26 | ||
| Fwd PE | 46.56 |
4.2 Price Multiples
PANW's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. PANW is cheaper than 64.23% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PANW indicates a somewhat cheap valuation: PANW is cheaper than 74.82% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.28 | ||
| EV/EBITDA | 87.69 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PANW does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of PANW may justify a higher PE ratio.
PANW's earnings are expected to grow with 18.86% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.01
PEG (5Y)1.94
EPS Next 2Y19.11%
EPS Next 3Y18.86%
5. Dividend
5.1 Amount
No dividends for PANW!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
PALO ALTO NETWORKS INC
NASDAQ:PANW (5/3/2024, 10:28:09 AM)
291.93
-3.39 (-1.15%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap94.32B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
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Div Incr Years
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Surprises & Revisions
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 54.26 | ||
| Fwd PE | 46.56 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.01
PEG (5Y)1.94
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.45% | ||
| ROE | 52.25% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 10.33% | ||
| PM (TTM) | 30.24% | ||
| GM | 74.05% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.41
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.83 | ||
| Quick Ratio | 0.83 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)64.36%
EPS 3Y39.45%
EPS 5Y
EPS growth Q2Q
EPS Next Y26.96%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)22.28%
Revenue growth 3Y26.46%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
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FCF growth 3Y
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