PALO ALTO NETWORKS INC (PANW) Fundamental Analysis & Valuation

NASDAQ:PANW • US6974351057

Current stock price

166.61 USD
-7.17 (-4.13%)
Last:

This PANW fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

6

1. PANW Profitability Analysis

1.1 Basic Checks

  • In the past year PANW was profitable.
  • In the past year PANW had a positive cash flow from operations.
  • The reported net income has been mixed in the past 5 years: PANW reported negative net income in multiple years.
  • Each year in the past 5 years PANW had a positive operating cash flow.
PANW Yearly Net Income VS EBIT VS OCF VS FCFPANW Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 1B 2B 3B

1.2 Ratios

  • With a decent Return On Assets value of 5.13%, PANW is doing good in the industry, outperforming 74.55% of the companies in the same industry.
  • With a decent Return On Equity value of 13.65%, PANW is doing good in the industry, outperforming 80.00% of the companies in the same industry.
  • PANW has a Return On Invested Capital of 5.95%. This is in the better half of the industry: PANW outperforms 74.91% of its industry peers.
  • PANW had an Average Return On Invested Capital over the past 3 years of 4.95%. This is significantly below the industry average of 10.99%.
  • The last Return On Invested Capital (5.95%) for PANW is above the 3 year average (4.95%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 5.13%
ROE 13.65%
ROIC 5.95%
ROA(3y)6.91%
ROA(5y)2.74%
ROE(3y)29.83%
ROE(5y)-23.25%
ROIC(3y)4.95%
ROIC(5y)N/A
PANW Yearly ROA, ROE, ROICPANW Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 -50 -100

1.3 Margins

  • Looking at the Profit Margin, with a value of 12.96%, PANW is in the better half of the industry, outperforming 77.82% of the companies in the same industry.
  • PANW's Operating Margin of 14.37% is amongst the best of the industry. PANW outperforms 81.09% of its industry peers.
  • PANW has a better Gross Margin (73.50%) than 60.36% of its industry peers.
  • PANW's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 14.37%
PM (TTM) 12.96%
GM 73.5%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.21%
GM growth 5Y0.76%
PANW Yearly Profit, Operating, Gross MarginsPANW Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 20 40 60

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6

2. PANW Health Analysis

2.1 Basic Checks

  • PANW has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
  • Compared to 1 year ago, PANW has more shares outstanding
  • The number of shares outstanding for PANW has been increased compared to 5 years ago.
  • PANW has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
PANW Yearly Shares OutstandingPANW Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 200M 400M 600M
PANW Yearly Total Debt VS Total AssetsPANW Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5B 10B 15B 20B

2.2 Solvency

  • An Altman-Z score of 6.21 indicates that PANW is not in any danger for bankruptcy at the moment.
  • Looking at the Altman-Z score, with a value of 6.21, PANW belongs to the top of the industry, outperforming 82.18% of the companies in the same industry.
  • There is no outstanding debt for PANW. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
Industry RankSector Rank
Debt/Equity 0
Debt/FCF 0
Altman-Z 6.21
ROIC/WACC0.54
WACC10.96%
PANW Yearly LT Debt VS Equity VS FCFPANW Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B

2.3 Liquidity

  • PANW has a Current Ratio of 1.04. This is a normal value and indicates that PANW is financially healthy and should not expect problems in meeting its short term obligations.
  • Looking at the Current ratio, with a value of 1.04, PANW is doing worse than 72.73% of the companies in the same industry.
  • A Quick Ratio of 1.04 indicates that PANW should not have too much problems paying its short term obligations.
  • PANW has a Quick ratio of 1.04. This is in the lower half of the industry: PANW underperforms 72.00% of its industry peers.
Industry RankSector Rank
Current Ratio 1.04
Quick Ratio 1.04
PANW Yearly Current Assets VS Current LiabilitesPANW Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B 8B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

8

3. PANW Growth Analysis

3.1 Past

  • PANW shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 23.46%, which is quite impressive.
  • 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.
  • The Revenue has grown by 15.43% in the past year. This is quite good.
  • PANW shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 22.03% yearly.
EPS 1Y (TTM)23.46%
EPS 3Y38.4%
EPS 5Y32.59%
EPS Q2Q%27.16%
Revenue 1Y (TTM)15.43%
Revenue growth 3Y18.79%
Revenue growth 5Y22.03%
Sales Q2Q%14.91%

3.2 Future

  • Based on estimates for the next years, PANW will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.26% on average per year.
  • The Revenue is expected to grow by 15.85% on average over the next years. This is quite good.
EPS Next Y12.75%
EPS Next 2Y10.1%
EPS Next 3Y12.36%
EPS Next 5Y15.26%
Revenue Next Year22.95%
Revenue Next 2Y21.45%
Revenue Next 3Y18.71%
Revenue Next 5Y15.85%

3.3 Evolution

  • Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
  • 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.
PANW Yearly Revenue VS EstimatesPANW Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 5B 10B 15B 20B 25B
PANW Yearly EPS VS EstimatesPANW Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2 4 6 8 10

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2

4. PANW Valuation Analysis

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 44.91, the valuation of PANW can be described as expensive.
  • Compared to the rest of the industry, the Price/Earnings ratio of PANW is on the same level as its industry peers.
  • PANW is valuated expensively when we compare the Price/Earnings ratio to 26.91, which is the current average of the S&P500 Index.
  • A Price/Forward Earnings ratio of 41.15 indicates a quite expensive valuation of PANW.
  • PANW's Price/Forward Earnings ratio is in line with the industry average.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 23.69, PANW is valued quite expensively.
Industry RankSector Rank
PE 44.91
Fwd PE 41.15
PANW Price Earnings VS Forward Price EarningsPANW Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40

4.2 Price Multiples

  • PANW's Enterprise Value to EBITDA ratio is in line with the industry average.
  • PANW's Price/Free Cash Flow is on the same level as the industry average.
Industry RankSector Rank
P/FCF 37.89
EV/EBITDA 76.68
PANW Per share dataPANW EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6 8 10

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.
  • 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 12.36% in the coming years.
PEG (NY)3.52
PEG (5Y)1.38
EPS Next 2Y10.1%
EPS Next 3Y12.36%

More info and screens

Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

0

5. PANW Dividend Analysis

5.1 Amount

  • PANW does not give a dividend.
Industry RankSector Rank
Dividend Yield 0%

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PANW Fundamentals: All Metrics, Ratios and Statistics

PALO ALTO NETWORKS INC

NASDAQ:PANW (4/9/2026, 1:17:09 PM)

166.61

-7.17 (-4.13%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)02-17
Earnings (Next)05-18
Inst Owners73.51%
Inst Owner Change0%
Ins Owners0.34%
Ins Owner Change8.1%
Market Cap135.12B
Revenue(TTM)9.89B
Net Income(TTM)1.28B
Analysts80.63
Price Target215.42 (29.3%)
Short Float %3.12%
Short Ratio2.18
Dividend
Industry RankSector Rank
Dividend Yield 0%
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)4.82%
Min EPS beat(2)2.41%
Max EPS beat(2)7.23%
EPS beat(4)4
Avg EPS beat(4)4.2%
Min EPS beat(4)1.85%
Max EPS beat(4)7.23%
EPS beat(8)8
Avg EPS beat(8)3.86%
EPS beat(12)12
Avg EPS beat(12)6.89%
EPS beat(16)16
Avg EPS beat(16)8.81%
Revenue beat(2)0
Avg Revenue beat(2)-1.46%
Min Revenue beat(2)-1.48%
Max Revenue beat(2)-1.43%
Revenue beat(4)0
Avg Revenue beat(4)-1.25%
Min Revenue beat(4)-1.48%
Max Revenue beat(4)-0.62%
Revenue beat(8)0
Avg Revenue beat(8)-1.13%
Revenue beat(12)0
Avg Revenue beat(12)-1.21%
Revenue beat(16)1
Avg Revenue beat(16)-1.16%
PT rev (1m)-0.14%
PT rev (3m)-7%
EPS NQ rev (1m)-0.02%
EPS NQ rev (3m)-13.78%
EPS NY rev (1m)0%
EPS NY rev (3m)-4.38%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)13.19%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)7.27%
Valuation
Industry RankSector Rank
PE 44.91
Fwd PE 41.15
P/S 13.66
P/FCF 37.89
P/OCF 34
P/B 14.39
P/tB 111.39
EV/EBITDA 76.68
EPS(TTM)3.71
EY2.23%
EPS(NY)4.05
Fwd EY2.43%
FCF(TTM)4.4
FCFY2.64%
OCF(TTM)4.9
OCFY2.94%
SpS12.2
BVpS11.58
TBVpS1.5
PEG (NY)3.52
PEG (5Y)1.38
Graham Number31.09
Profitability
Industry RankSector Rank
ROA 5.13%
ROE 13.65%
ROCE 8.38%
ROIC 5.95%
ROICexc 8.13%
ROICexgc 23.75%
OM 14.37%
PM (TTM) 12.96%
GM 73.5%
FCFM 36.04%
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-Score5
Asset Turnover0.4
Health
Industry RankSector Rank
Debt/Equity 0
Debt/FCF 0
Debt/EBITDA 0
Cap/Depr 116.11%
Cap/Sales 4.13%
Interest Coverage 250
Cash Conversion 224.05%
Profit Quality 278.17%
Current Ratio 1.04
Quick Ratio 1.04
Altman-Z 6.21
F-Score5
WACC10.96%
ROIC/WACC0.54
Cap/Depr(3y)59.63%
Cap/Depr(5y)58.33%
Cap/Sales(3y)2.25%
Cap/Sales(5y)2.6%
Profit Quality(3y)341.57%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)23.46%
EPS 3Y38.4%
EPS 5Y32.59%
EPS Q2Q%27.16%
EPS Next Y12.75%
EPS Next 2Y10.1%
EPS Next 3Y12.36%
EPS Next 5Y15.26%
Revenue 1Y (TTM)15.43%
Revenue growth 3Y18.79%
Revenue growth 5Y22.03%
Sales Q2Q%14.91%
Revenue Next Year22.95%
Revenue Next 2Y21.45%
Revenue Next 3Y18.71%
Revenue Next 5Y15.85%
EBIT growth 1Y46.66%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year41.96%
EBIT Next 3Y25.17%
EBIT Next 5YN/A
FCF growth 1Y22.04%
FCF growth 3Y24.64%
FCF growth 5Y33.4%
OCF growth 1Y29.79%
OCF growth 3Y23.25%
OCF growth 5Y29.11%

PALO ALTO NETWORKS INC / PANW Fundamental Analysis 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 for PANW stock?

ChartMill assigns a valuation rating of 2 / 10 to PALO ALTO NETWORKS INC (PANW). This can be considered as Overvalued.


Can you provide the profitability details for PALO ALTO NETWORKS INC?

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 44.91 and the Price/Book (PB) ratio is 14.39.