Stocks

Palo Alto Networks (NASDAQ:PANW) Shares Rise 1.1% – Should Investors Consider Buying?

Published January 5, 2025

Palo Alto Networks, Inc. (NASDAQ:PANW) experienced a 1.1% increase in share price on Friday. The stock reached a high of $183.53 and was last traded at $182.70. During mid-day trading, around 755,407 shares exchanged hands, which is a significant decline of 71% compared to the average daily volume of 2,577,069 shares. The stock's previous closing price was noted at $180.74.

Insights from Wall Street Analysts

Several research reports have focused on Palo Alto Networks lately. Cantor Fitzgerald reiterated an “overweight” rating with a price target of $222.50 on November 21. Jefferies Financial Group raised its price target on the company from $225.00 to $240.00, maintaining a “buy” rating as of December 19. BMO Capital Markets also increased their target from $195.00 to $212.50, designating an “outperform” rating on November 21. In contrast, Scotiabank lowered their target from $400.00 to $200.00, while retaining a “sector outperform” rating. Lastly, Susquehanna increased their price target from $210.00 to $217.50, providing a “positive” rating on the same date. Currently, there are two sell ratings, ten hold ratings, thirty-one buy ratings, and one strong buy rating for the stock. According to MarketBeat.com, Palo Alto Networks has a consensus rating of “Moderate Buy” with a consensus target price of $201.46.

Explore Our In-Depth Analysis on Palo Alto Networks

Palo Alto Networks Stock Movement

The company boasts a market capitalization of $120.25 billion, with a price-to-earnings ratio of 23.86 and a price-to-earnings-growth ratio of 5.75. Its fifty-day moving average is $191.81, while the two-hundred-day moving average stands at $177.89.

Palo Alto Networks reported its quarterly earnings on November 20. They posted earnings per share (EPS) of $0.78, surpassing analysts’ expectations of $0.74 by $0.04. The company's return on equity was recorded at 23.36%, with a net margin of 32.99%. The reported revenue for the quarter was $2.14 billion, compared to the forecasted estimate of $2.12 billion. This marks a 13.9% year-over-year increase in quarterly revenue, as they had posted an EPS of $0.32 in the same quarter the previous year. Analysts project Palo Alto Networks will achieve a total EPS of 3.49 for the current year.

Insights on Insider Transactions

In related news, EVP Nir Zuk sold 336,000 shares of Palo Alto Networks on November 25, at an average price of $193.70, totaling $65,081,520. Following this transaction, Zuk’s direct ownership of the company’s stock decreased by 8.44%. Additionally, CEO Nikesh Arora sold 163,172 shares on October 10 at an average price of $184.00, which amounted to $30,022,832.14. After this sale, Arora’s ownership dropped by 11.65%. As per SEC filings, corporate insiders currently own approximately 2.50% of the company’s stock.

Institutional Investors Adjust Holdings

Several hedge funds and institutional investors have recently adjusted their positions in Palo Alto Networks. Mainstream Capital Management LLC acquired a new stake during the third quarter valued at about $1,156,000. Alpha Cubed Investments LLC boosted its position by 16.4% during the same period, now holding 231,566 shares worth approximately $79,149,000 after purchasing an additional 32,626 shares. Harvest Portfolios Group Inc. also bought a new position worth around $24,414,000 during the third quarter. Handelsbanken Fonder AB increased their stake by 3.8%, bringing their total to 196,700 shares, equivalent to $67,232,000. Finally, Jennison Associates LLC lifted theirs by 50.1%, now owning 3,147,215 shares valued at about $1,075,718,000. At present, around 79.82% of the company's shares are held by institutional and hedge fund investors.

About Palo Alto Networks

Palo Alto Networks, Inc. provides a range of cybersecurity solutions across the globe. Their offerings include firewall devices and software, as well as Panorama, a security management solution designed for comprehensive network security management. Also, they provide subscription services for threat prevention, malware protection, URL filtering, and more, in addition to threat intelligence and data loss prevention services.