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Shares of Palo Alto Networks soared as a lot as 12% on Aug. 23 after the community safety firm reported outcomes for its fiscal fourth quarter and stated it anticipated gross sales to extend by not less than 25% in fiscal 2023.
Palo Alto
PANW,
CEO Nikesh Arora described the corporate’s fiscal steerage as “prudent.” MarketWatch’s Wallace Witkowski summarized the company’s results and its recent history of beating analysts estimates and its own guidance.
Different elements that will have helped raise Palo Alto’s shares included an enlargement of its buyback program and a three-for-one stock split planned for Sept. 14.
Throughout fiscal 2022, Palo Alto’s gross sales elevated by 29% to $5.502 billion. The corporate’s gross revenue elevated by 27% to $3.783 billion. However that was outweighed by working bills totaling $3.972 billion, for an working lack of $189 million. The diluted web loss per share for fiscal 2022 was $2.71, narrowing from a lack of $5.18 a share in fiscal 2021.
For the fourth quarter of fiscal 2022, the corporate was worthwhile, with EPS of three cents. It additionally anticipated to be worthwhile on a GAAP foundation in fiscal 2023.
However from the rapid response, it’s clear that traders are fixated on Palo Alto’s gross sales progress.
What about its rivals? In its annual report for fiscal 2021, Palo Alto listed 5 “essential rivals” by identify: Cisco Programs Inc.
CSCO,
Test Level Software program Applied sciences, Ltd.
CHKP,
Fortinet Inc.,
FTNT,
Zscaler Inc.
ZS,
and CrowdStrike Holdings Inc.
CRWD,
FactSet lists three extra “key” rivals to Palo Alto inside the “community and communications {hardware}” house for which consensus gross sales estimates can be found by 2024. They’re included within the chart under.
How shortly are Palo Alto’s rivals anticipated to develop?
Palo Alto isn’t alone in having a fiscal yr that doesn’t match the calendar. As a way to examine its anticipated gross sales progress with its rivals, we checked out consensus estimates for calendar years 2022, 2023 and 2024 amongst analysts polled by FactSet.
Listed here are the 9 firms listed by anticipated two-year compound annual progress charges (CAGR) for gross sales by 2024:
| Firm | Ticker | Two-year anticipated gross sales CAGR by 2024 | Estimated gross sales – 2022 ($mil) | Estimated gross sales – 2023 ($mil) | Estimated gross sales – 2024 ($mil) | Market cap. ($mil) |
| CrowdStrike Holdings Inc. Class A |
CRWD, |
33.9% | $2,142 | $2,935 | $3,837 | $39,670 |
| Zscaler Inc. |
ZS, |
31.2% | $1,243 | $1,660 | $2,140 | $23,124 |
| Palo Alto Networks Inc. |
PANW, |
21.8% | $6,070 | $7,462 | $8,998 | $50,620 |
| Fortinet Inc. |
FTNT, |
20.8% | $4,383 | $5,299 | $6,392 | $39,678 |
| Arista Networks Inc. |
ANET, |
12.3% | $4,064 | $4,634 | $5,124 | $38,686 |
| Motorola Options Inc. |
MSI, |
6.5% | $8,867 | $9,416 | $10,059 | $41,498 |
| Juniper Networks Inc. |
JNPR, |
4.5% | $5,213 | $5,501 | $5,690 | $9,346 |
| Test Level Software program Applied sciences Ltd. |
CHKP, |
4.2% | $2,317 | $2,427 | $2,515 | $15,264 |
| Cisco Programs Inc. |
CSCO, |
4.1% | $52,620 | $54,930 | $57,024 | $197,565 |
| Supply: FactSet | ||||||
Click on on the tickers for extra about every firm. Then read Tomi Kilgore’s detailed information to the wealth of knowledge accessible at no cost on MarketWatch quote pages.
For anticipated gross sales progress over the following two calendar years, Palo Alto ranks third, with smaller rivals Crowdstrike and Zscaler taking the highest two spots. The biggest firm on the checklist, Cisco Programs, brings up the rear. Then once more, Cisco’s “Finish to Finish Safety” section is anticipated to extend gross sales to $4.625 billion in 2024 from $3.86 billion in 2022, for anticipated CAGR of 9.5%.
Leaving the businesses in the identical order, right here’s a abstract of opinion amongst analysts polled by FactSet:
| Firm | Ticker | Share “purchase” scores | Share impartial scores | Share “promote” scores | Closing value – Aug. 22 | Consensus value goal | Implied 12-month upside potential |
| CrowdStrike Holdings Inc. Class A |
CRWD, |
100% | 0% | 0% | $185.88 | $236.50 | 27% |
| Zscaler Inc. |
ZS, |
84% | 16% | 0% | $163.00 | $204.83 | 26% |
| Palo Alto Networks Inc. |
PANW, |
92% | 8% | 0% | $508.05 | $655.41 | 29% |
| Fortinet Inc. |
FTNT, |
69% | 31% | 0% | $50.32 | $71.74 | 43% |
| Arista Networks Inc. |
ANET, |
57% | 39% | 4% | $127.14 | $149.91 | 18% |
| Motorola Options Inc. |
MSI, |
72% | 21% | 7% | $248.66 | $286.44 | 15% |
| Juniper Networks Inc. |
JNPR, |
40% | 40% | 20% | $28.97 | $33.28 | 15% |
| Test Level Software program Applied sciences Ltd. |
CHKP, |
41% | 37% | 22% | $121.71 | $137.77 | 13% |
| Cisco Programs Inc. |
CSCO, |
45% | 52% | 3% | $47.71 | $54.05 | 13% |
| Supply: FactSet | |||||||
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