PALO ALTO NETWORKS INC (PANW) Stock Fundamental Analysis
USA - NASDAQ:PANW - US6974351057 - Common Stock
213.18 USD
-1.34 (-0.62%)
211.65 USD
-1.53 (-0.72%)
Taking everything into account, PANW scores 5 out of 10 in our fundamental rating. PANW was compared to 284 industry peers in the Software industry. PANW has an average financial health and profitability rating. 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 multiple years PANW reported negative net income over the last 5 years.
Of the past 5 years PANW 4 years had a positive operating cash flow.
1.2 Ratios
PANW has a better Return On Assets (5.63%) than 73.59% of its industry peers.
PANW's Return On Equity of 17.12% is amongst the best of the industry. PANW outperforms 84.86% of its industry peers.
Looking at the Return On Invested Capital, with a value of 5.01%, PANW is in the better half of the industry, outperforming 73.94% of the companies in the same industry.
PANW had an Average Return On Invested Capital over the past 3 years of 4.95%. This is significantly below the industry average of 11.85%.
The 3 year average ROIC (4.95%) for PANW is below the current ROIC(5.01%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.63% | ||
| ROE | 17.12% | ||
| ROIC | 5.01% |
ROA(3y)6.91%
ROA(5y)2.74%
ROE(3y)29.83%
ROE(5y)-23.25%
ROIC(3y)4.95%
ROIC(5y)N/A
1.3 Margins
PANW's Profit Margin of 13.95% is fine compared to the rest of the industry. PANW outperforms 76.76% of its industry peers.
PANW's Operating Margin of 11.36% is fine compared to the rest of the industry. PANW outperforms 77.11% of its industry peers.
PANW has a better Gross Margin (73.56%) than 61.62% of its industry peers.
PANW's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.36% | ||
| PM (TTM) | 13.95% | ||
| GM | 73.56% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.21%
GM growth 5Y0.76%
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 no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
An Altman-Z score of 6.55 indicates that PANW is not in any danger for bankruptcy at the moment.
PANW has a Altman-Z score of 6.55. This is in the better half of the industry: PANW outperforms 75.70% 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 | 0.13 | ||
| Altman-Z | 6.55 |
ROIC/WACC0.46
WACC10.96%
2.3 Liquidity
PANW has a Current Ratio of 0.90. This is a bad value and indicates that PANW is not financially healthy enough and could expect problems in meeting its short term obligations.
PANW's Current ratio of 0.90 is on the low side compared to the rest of the industry. PANW is outperformed by 76.41% of its industry peers.
A Quick Ratio of 0.90 indicates that PANW may have some problems paying its short term obligations.
PANW's Quick ratio of 0.90 is on the low side compared to the rest of the industry. PANW is outperformed by 75.70% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.9 | ||
| Quick Ratio | 0.9 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 17.81% 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 32.59% on average per year.
PANW shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 14.87%.
PANW shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 22.03% yearly.
EPS 1Y (TTM)17.81%
EPS 3Y38.4%
EPS 5Y32.59%
EPS Q2Q%25.83%
Revenue 1Y (TTM)14.87%
Revenue growth 3Y18.79%
Revenue growth 5Y22.03%
Sales Q2Q%15.84%
3.2 Future
The Earnings Per Share is expected to grow by 15.15% on average over the next years. This is quite good.
PANW is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.00% yearly.
EPS Next Y16.5%
EPS Next 2Y14.66%
EPS Next 3Y14.34%
EPS Next 5Y15.15%
Revenue Next Year14.45%
Revenue Next 2Y13.93%
Revenue Next 3Y13.21%
Revenue Next 5Y13%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 63.83, which means the current valuation is very expensive for PANW.
PANW's Price/Earnings ratio is in line with the industry average.
PANW is valuated expensively when we compare the Price/Earnings ratio to 26.13, which is the current average of the S&P500 Index.
PANW is valuated quite expensively with a Price/Forward Earnings ratio of 54.79.
The rest of the industry has a similar Price/Forward Earnings ratio as PANW.
The average S&P500 Price/Forward Earnings ratio is at 22.35. PANW is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 63.83 | ||
| Fwd PE | 54.79 |
4.2 Price Multiples
PANW's Enterprise Value to EBITDA is on the same level as the industry average.
PANW's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. PANW is cheaper than 61.27% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 48.09 | ||
| EV/EBITDA | 105.21 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
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 14.34% in the coming years.
PEG (NY)3.87
PEG (5Y)1.96
EPS Next 2Y14.66%
EPS Next 3Y14.34%
5. Dividend
5.1 Amount
PANW does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
213.18
-1.34 (-0.62%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners83.03%
Inst Owner Change-0.43%
Ins Owners0.91%
Ins Owner Change-11.17%
Market Cap144.30B
Revenue(TTM)9.22B
Net Income(TTM)1.24B
Analysts79.02
Price Target224.09 (5.12%)
Short Float %6.94%
Short Ratio7.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.01%
Min EPS beat(2)1.85%
Max EPS beat(2)2.16%
EPS beat(4)4
Avg EPS beat(4)3.09%
Min EPS beat(4)1.85%
Max EPS beat(4)5.04%
EPS beat(8)8
Avg EPS beat(8)6.54%
EPS beat(12)12
Avg EPS beat(12)10.13%
EPS beat(16)16
Avg EPS beat(16)8.85%
Revenue beat(2)0
Avg Revenue beat(2)-1.31%
Min Revenue beat(2)-1.46%
Max Revenue beat(2)-1.16%
Revenue beat(4)0
Avg Revenue beat(4)-1.11%
Min Revenue beat(4)-1.46%
Max Revenue beat(4)-0.7%
Revenue beat(8)0
Avg Revenue beat(8)-1.18%
Revenue beat(12)0
Avg Revenue beat(12)-1.27%
Revenue beat(16)4
Avg Revenue beat(16)-0.65%
PT rev (1m)3.27%
PT rev (3m)4.45%
EPS NQ rev (1m)-0.03%
EPS NQ rev (3m)-0.03%
EPS NY rev (1m)0.07%
EPS NY rev (3m)3.66%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 63.83 | ||
| Fwd PE | 54.79 | ||
| P/S | 16.26 | ||
| P/FCF | 48.09 | ||
| P/OCF | 44.98 | ||
| P/B | 19.96 | ||
| P/tB | 58.91 | ||
| EV/EBITDA | 105.21 |
EPS(TTM)3.34
EY1.57%
EPS(NY)3.89
Fwd EY1.83%
FCF(TTM)4.43
FCFY2.08%
OCF(TTM)4.74
OCFY2.22%
SpS13.11
BVpS10.68
TBVpS3.62
PEG (NY)3.87
PEG (5Y)1.96
Graham Number28.33
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.63% | ||
| ROE | 17.12% | ||
| ROCE | 7.05% | ||
| ROIC | 5.01% | ||
| ROICexc | 6.51% | ||
| ROICexgc | 11.52% | ||
| OM | 11.36% | ||
| PM (TTM) | 13.95% | ||
| GM | 73.56% | ||
| FCFM | 33.81% |
ROA(3y)6.91%
ROA(5y)2.74%
ROE(3y)29.83%
ROE(5y)-23.25%
ROIC(3y)4.95%
ROIC(5y)N/A
ROICexc(3y)6.58%
ROICexc(5y)N/A
ROICexgc(3y)15.61%
ROICexgc(5y)N/A
ROCE(3y)6.97%
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.21%
GM growth 5Y0.76%
F-Score6
Asset Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.13 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 61.75% | ||
| Cap/Sales | 2.34% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 238.74% | ||
| Profit Quality | 242.41% | ||
| Current Ratio | 0.9 | ||
| Quick Ratio | 0.9 | ||
| Altman-Z | 6.55 |
F-Score6
WACC10.96%
ROIC/WACC0.46
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)17.81%
EPS 3Y38.4%
EPS 5Y32.59%
EPS Q2Q%25.83%
EPS Next Y16.5%
EPS Next 2Y14.66%
EPS Next 3Y14.34%
EPS Next 5Y15.15%
Revenue 1Y (TTM)14.87%
Revenue growth 3Y18.79%
Revenue growth 5Y22.03%
Sales Q2Q%15.84%
Revenue Next Year14.45%
Revenue Next 2Y13.93%
Revenue Next 3Y13.21%
Revenue Next 5Y13%
EBIT growth 1Y14.61%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year28.4%
EBIT Next 3Y17.96%
EBIT Next 5YN/A
FCF growth 1Y-0.39%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y1.55%
OCF growth 3YN/A
OCF growth 5YN/A
PALO ALTO NETWORKS INC / PANW FAQ
What is the ChartMill fundamental rating of PALO ALTO NETWORKS INC (PANW) stock?
ChartMill assigns a fundamental rating of 5 / 10 to PANW.
What is the valuation status of PALO ALTO NETWORKS INC (PANW) stock?
ChartMill assigns a valuation rating of 3 / 10 to PALO ALTO NETWORKS INC (PANW). This can be considered as Overvalued.
How profitable is PALO ALTO NETWORKS INC (PANW) stock?
PALO ALTO NETWORKS INC (PANW) has a profitability rating of 6 / 10.
Can you provide the PE and PB ratios for PANW stock?
The Price/Earnings (PE) ratio for PALO ALTO NETWORKS INC (PANW) is 63.83 and the Price/Book (PB) ratio is 19.96.
What is the financial health of PALO ALTO NETWORKS INC (PANW) stock?
The financial health rating of PALO ALTO NETWORKS INC (PANW) is 5 / 10.