This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Palo Alto Networks IPO: High Expectations

NEW YORK ( TheStreet) - Palo Alto Networks makes its debut as a public company on Friday amid high expectations for the security specialist.

The Santa Clara, Calif.-based company's IPO was priced at $42 a share late on Thursday, just days after raising its offering price to between $38 and $40 a share.

"This is a good IPO -- it's 40 times oversubscribed," Scott Sweet, senior managing partner of IPO Boutique, told TheStreet. "The numbers on Palo Alto are outstanding -- of all the cloud-based IPOs that have debuted in 2012 and prior, the numbers in growth in the top and bottom line stand apart."

The Fortinet (FTNT - Get Report) and Check Point Software (CHKP - Get Report) rival is offering 4,687,259 of the 6.2 million total IPO shares and will trade on the New York Stock Exchange under the symbol 'PANW'.

Palo Alto certainly enjoy impressive demand for its firewall technology, which protects data centers, enterprise Internet gateways, and service providers.

The company grew its annual revenue from $13.4 million in fiscal 2009 to $118.6 million in fiscal 2011 and its net loss narrowed from $19 million to $12.5 million over the same period. Palo Alto brought in revenue of $179.5 million in the nine months ended April 30, 2012.

The firm's IPO timing is also good, according to Sweet. "They are coming out at the sweet spot of the market given that the best-performing IPOs of this year have all been cloud-based," he said, pointing to the recent offerings from Splunk (SPLK), Demandware (DMWRE) and Guidewire Software (GWRE).

The analyst, however, wants more detail on how Palo Alto will maintain its upward trajectory. "What means and what opportunities do they see to continue on that red hot growth?" he said.

Palo Alto is also embroiled in a patent legal battle with Juniper (JNPR - Get Report).

Online travel firm Kayak also makes its public debut on Friday after pricing its IPO at $26 a share, above the expected price range of $22 to $25. The Norwalk, Conn.-based company, which is offering 3.5 million shares, is set to start trading on the Nasdaq under the ticker symbol 'KYAK'.

"I expect both Palo Alto and Kayak to pop big," noted Sweet.

--Written by James Rogers in New York.

>To submit a news tip, send an email to: tips@thestreet.com.

Check out our new tech blog, Tech Trends. Follow TheStreet Tech on your wireless devices.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
CHKP $87.42 1.80%
FTNT $37.80 9.20%
JNPR $24.10 -0.17%
PANW $151.84 3.60%
AAPL $127.17 -0.34%

Markets

DOW 17,997.93 -37.00 -0.21%
S&P 500 2,103.76 +3.36 0.16%
NASDAQ 5,018.0050 +23.4030 0.47%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs