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Palo Alto Networks (PANW) Stock Sinks As Market Gains: What You Should Know

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Palo Alto Networks (PANW - Free Report) ended the recent trading session at $171.00, demonstrating a -1.09% change from the preceding day's closing price. This change lagged the S&P 500's daily gain of 1.47%. Meanwhile, the Dow experienced a rise of 1.34%, and the technology-dominated Nasdaq saw an increase of 1.95%.

Shares of the security software maker have depreciated by 14.34% over the course of the past month, underperforming the Computer and Technology sector's gain of 3.41%, and the S&P 500's gain of 0.64%.

Investors will be eagerly watching for the performance of Palo Alto Networks in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on August 18, 2025. The company is predicted to post an EPS of $0.88, indicating a 17.33% growth compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.5 billion, up 14.18% from the year-ago period.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $3.27 per share and a revenue of $9.19 billion, indicating changes of +15.14% and 0%, respectively, from the former year.

Investors should also pay attention to any latest changes in analyst estimates for Palo Alto Networks. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. At present, Palo Alto Networks boasts a Zacks Rank of #3 (Hold).

Looking at valuation, Palo Alto Networks is presently trading at a Forward P/E ratio of 47.38. This represents a discount compared to its industry average Forward P/E of 62.95.

It is also worth noting that PANW currently has a PEG ratio of 2.32. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The average PEG ratio for the Security industry stood at 2.93 at the close of the market yesterday.

The Security industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 96, this industry ranks in the top 39% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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