Palo Alto Networks (PANW) Reports Q4: Everything You Need To Know Ahead Of Earnings

Max Juang /
2023/08/17 6:59 am EDT

Cybersecurity provider Palo Alto Networks (NASDAQ:PANW) will be reporting results tomorrow afternoon. Here's what to expect.

Last quarter Palo Alto Networks reported revenues of $1.72 billion, up 24.1% year on year, in line with analyst expectations. The company delivered a strong "beat and raise" quarter, with third-quarter sales meeting analysts' estimates and billings surpassing Consensus projections.

Is Palo Alto Networks buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Palo Alto Networks' revenue to grow 26.3% year on year to $1.96 billion, in line with the 27.2% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.29 per share.

Palo Alto Networks Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 1.77%.

Looking at Palo Alto Networks's peers in the cybersecurity segment, some of them have already reported Q4 earnings results, giving us a hint of what we can expect. Rapid7 delivered top-line growth of 13.7% year on year, beating analyst estimates by 1.24%, and Qualys reported revenues up 14.4% year on year, exceeding estimates by 1.05%. Rapid7 traded up 8.7% on the results, and Qualys was up 8.0%.

Read our full analysis of Rapid7's results here and Qualys's results here.

Tech stocks have had a rocky start since 2022 and while some of the cybersecurity stocks have fared somewhat better, they have not been spared, with share price declining 9.68% over the last month. Palo Alto Networks is down 13.2% during the same time, and is heading into the earnings with analysts' average price target of $253.5, compared to share price of $213.4.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.