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Palo Alto Networks Inc
PANW : NYSE : Technology
$185.13 up1.50 | 0.81%
Today's Range: 181.00 - 186.54
Avg. Daily Volume: 1,424,200
07/30/15 - 3:59 PM ET

Financial Analysis


PALO ALTO NETWORKS INC's gross profit margin for the third quarter of its fiscal year 2015 is essentially unchanged when compared to the same period a year ago. The company grew its sales and net income significantly quarter versus same quarter a year prior, and was able to outpace the average competitor in the industry when comparing revenue growth, but not when comparing net income growth. PALO ALTO NETWORKS INC has average liquidity. Currently, the Quick Ratio is 1.03 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has greatly increased by 67.20% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q3 FY15 Q3 FY14
Net Sales ($mil)234.17150.7
EBITDA ($mil)-29.37-16.42
EBIT ($mil)-36.72-20.98
Net Income ($mil)-45.94-146.59


Balance Sheet Q3 FY15 Q3 FY14
Cash & Equiv. ($mil)822.97367.97
Total Assets ($mil)1784.43880.39
Total Debt ($mil)481.960.0
Equity ($mil)454.28271.69


Profitability Q3 FY15 Q3 FY14
Gross Profit Margin75.6476.67
EBITDA Margin-12.54-10.89
Operating Margin-15.68-13.92
Sales Turnover0.460.6
Return on Assets-8.46-23.87
Return on Equity-33.25-77.37
Debt Q3 FY15 Q3 FY14
Current Ratio1.11.19
Debt/Capital0.510.0
Interest Expense5.630.01
Interest Coverage-6.52-1613.54


Share Data Q3 FY15 Q3 FY14
Shares outstanding (mil)83.677.06
Div / share0.00.0
EPS-0.56-1.96
Book value / share5.433.53
Institutional Own % n/a n/a
Avg Daily Volume1374674.01363089.0

Valuation


SELL. This stock?s P/E ratio is negative, making its value useless in the assessment of premium or discount valuation, only displaying that the company has negative earnings per share. For additional comparison, its price-to-book ratio of 36.27 indicates a significant premium versus the S&P 500 average of 2.82 and a significant premium versus the industry average of 4.43. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, PALO ALTO NETWORKS INC seems to be trading at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
PANW NM Peers 30.68   PANW 79.35 Peers 28.21

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

PANW's P/E is negative making this valuation measure meaningless.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

PANW is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
PANW 120.91 Peers 24.56   PANW NA Peers 2.40

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

PANW is trading at a significant premium to its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
PANW 36.27 Peers 4.43   PANW 33.81 Peers 133.43

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

PANW is trading at a significant premium to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, PANW is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
PANW 20.03 Peers 3.44   PANW 54.49 Peers 3.31

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

PANW is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

PANW has a sales growth rate that significantly exceeds its peers.

 

 

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