PANW Palo Alto Networks Inc.
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Daily prices, adjusted for splits. P/E and P/S value each day on the results published by then; a gap in P/E means the trailing year had no profit.
Software - Infrastructure · Santa Clara, CA · 21,921 employees · paloaltonetworks.com
Palo Alto Networks provides cybersecurity products and platforms designed to secure networks, cloud environments, and digital operations. It generates revenue primarily through security subscriptions covering threat prevention and cloud protection, alongside virtual firewalls, professional consulting, and technical support. Its offerings are distributed globally to commercial enterprises and government entities through direct sales and channel partners.
Bull case
The business converts a meaningful share of its revenue into free cash flow even after covering stock compensation. This cash generation is reinforced by sustained profitability and cash reserves that exceed total debt obligations.
- Turns 20% of revenue into free cash after stock pay.
- Annual revenue growth rose from +15% to +24%, including acquired businesses.
- It holds more cash than debt and is profitable.
- The share price trend is rising.
Bear case
Gross margins have compressed notably below recent norms, and stock-based compensation represents a substantial portion of incoming revenue.
- Trades at the 100th percentile of its own valuation history.
- The price assumes about +35% a year cash-flow growth, more than the +14% a year it delivered, including acquisitions.
- Valued above what companies with similar growth, margins and size trade at.
- Gross margin is 6.4 points below its recent norm.
Features
- V-OVERVALUED Overvalued The price is 115% above its own-history reference value.
- V-MARGIN-COMPRESSION Margin compression Gross margin is 6.4 points below its recent norm.
- V-ACCELERATING Growth accelerating Annual revenue growth rose from +15% to +24%, including acquired businesses. Shared by most companies we track
- H-FORTRESS Fortress balance sheet It holds more cash than debt and is profitable.
- G-AGENCY Heavy stock pay Stock pay equals 16% of revenue.
AI impact
Sells AI to its customers Headwind
The company sells cybersecurity platforms and services that incorporate artificial intelligence to protect enterprise networks, clouds, and applications. Although the company's reports do not show an advantage from artificial intelligence, rivals and cloud providers could displace its offerings by embedding competing security capabilities directly into their own platforms.
Where AI could hurt it
- AI tools could do part of what it sells (minor)
- AI makes it cheaper for rivals to build what it sells (minor)
In the company's words
• Cloud infrastructure providers and advanced AI companies increasingly offer native security and observability capabilities that compete directly with our offerings.
Assessed by AI from the company's own annual report filed 10 Sep 2026. A reading of the business, not a forecast or a recommendation.
Valuation position
PANW is at the 100th percentile of its own valuation history. This is a relative measurement, not a price target or recommendation, and it assumes the business is still the one its history describes.
Price ladder
The measured price sits in the Above reference zone. These are reference zones, not buy instructions or forecasts that the prices will be reached.
What the price assumes
The measured price implies roughly +34.6% annual cash-flow growth, between +25.9% and +41.0% under other reasonable assumptions. Over the last three years it delivered +14.2% a year.
An estimate that depends on its assumptions, not a forecast.
Quality versus peers
Each dimension is shown on its own; they are not combined into a score.
Current analyst snapshot
Shown for reference only; not used in any measurement.
What would have to break
- Not triggered — Revenue decline
- Not triggered — Margin break
- Not triggered — Cash burn with rising debt
- Not triggered — Heavy dilution
- Not triggered — Warning language in filings
News
No recent brief on this company.