Latest news with #securitysoftware
Yahoo
3 days ago
- Business
- Yahoo
Palo Alto Networks (PANW) Beats Q4 Earnings and Revenue Estimates
Palo Alto Networks (PANW) came out with quarterly earnings of $0.95 per share, beating the Zacks Consensus Estimate of $0.88 per share. This compares to earnings of $0.75 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +7.95%. A quarter ago, it was expected that this security software maker would post earnings of $0.77 per share when it actually produced earnings of $0.8, delivering a surprise of +3.9%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Palo Alto, which belongs to the Zacks Security industry, posted revenues of $2.54 billion for the quarter ended July 2025, surpassing the Zacks Consensus Estimate by 1.46%. This compares to year-ago revenues of $2.19 billion. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Palo Alto shares have lost about 2.7% since the beginning of the year versus the S&P 500's gain of 9.7%. What's Next for Palo Alto? While Palo Alto has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Palo Alto was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.84 on $2.44 billion in revenues for the coming quarter and $3.65 on $10.43 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Security is currently in the bottom 28% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. CrowdStrike Holdings (CRWD), another stock in the same industry, has yet to report results for the quarter ended July 2025. The results are expected to be released on August 27. This cloud-based security company is expected to post quarterly earnings of $0.83 per share in its upcoming report, which represents a year-over-year change of -20.2%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. CrowdStrike Holdings' revenues are expected to be $1.15 billion, up 19.2% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Palo Alto Networks, Inc. (PANW) : Free Stock Analysis Report CrowdStrike (CRWD) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Wall Street Journal
24-06-2025
- Business
- Wall Street Journal
BlackBerry Boosts Fiscal-Year Sales Outlook After Revenue Beats Expectations
BlackBerry BB 0.00%increase; green up pointing triangle raised its sales guidance for the fiscal year after logging higher-than-expected revenue in its latest quarter. The security-software company on Tuesday said it now expects revenue of $508 million to $538 million for fiscal 2026, up from its prior guidance of $504 million to $534 million. Analysts polled by FactSet expect $521.8 million, below the midpoint of BlackBerry's new range.
Forbes
04-06-2025
- Business
- Forbes
Is CRWD Stock Overvalued At $460?
CANADA - 2025/04/23: In this photo illustration, the CrowdStrike Holdings logo is seen displayed on ... More a smartphone screen. (Photo Illustration by Thomas Fuller/SOPA Images/LightRocket via Getty Images) Yes, we think so. Trading at a whopping 122 times its adjusted trailing earnings, CrowdStrike (NASDAQ:CRWD), a security software company, looks expensive. Sure, the company's growth has remained impressive lately. But the important question is whether this valuation is justified. And we don't think it is. Our conclusion is based on a comparison of CRWD's current valuation with its recent operating performance and current and historical financial condition. Our analysis of CrowdStrike, across key parameters of Growth, Profitability, Financial Stability, and Downturn Resilience, reveals a very strong operating performance and financial condition, as detailed below. Now, to reduce stock specific risk, consider taking a look at the Trefis High Quality portfolio, which has outperformed the S&P 500 and achieved returns greater than 91% since inception. Also, see – How Did CrowdStrike Fare In Q1? CrowdStrike's valuation appears significantly higher than the broader market, with its price-to-sales (P/S) ratio standing at 28.1 - well above the S&P 500's 3.2. Our dashboard on CrowdStrike's valuation ratios has more details. This high valuation comes despite the company demonstrating extremely strong top-line growth in recent years. Over the last three years, CrowdStrike's revenue has expanded at an average rate of 40%, far exceeding the S&P 500's 6.3%. Also, revenues grew 20% to $1.1 billion in the most recent quarter, outperforming the S&P 500's growth rate. Regarding profitability, CrowdStrike's reported operating income over the last twelve months was -$252 million, resulting in a negative operating margin of -6.1%, which is worse than most companies. However, on an adjusted basis, its operating margin was a healthy 20.3% for the same period. Adjusted operating income excludes stock-based compensation and certain one-time items such as acquisition-related expenses and other non-recurring costs. The company also shows strong cash generation, with an operating cash flow of $1.4 billion, leading to a high operating cash flow-to-sales ratio of 33.4%, significantly better than the S&P 500's 15.7%. CrowdStrike's financial stability is very strong. With a debt of $785 million against a market capitalization of $122 billion, its debt-to-equity ratio is a very low 0.6%, indicating minimal reliance on debt compared to the S&P 500's 19.0%. Furthermore, cash and cash equivalents of $4.6 billion make up 53% of its total assets, highlighting a robust cash-to-assets ratio compared to the S&P 500's 14.8%. Despite its strong growth and financial health, CRWD stock has shown weakness during market downturns. During the 2022 Inflation Shock, the stock fell 58.3%, a steeper decline than the S&P 500's 25.4%. Similarly, during the 2020 Covid pandemic, it dropped 50.0% compared to the S&P 500's 33.9%. While the stock fully recovered to its pre-crisis peaks in both instances, its greater volatility suggests weaker resilience during market crashes. In summary, CrowdStrike shows strong performance across key financial metrics, and its profitability is good on an adjusted basis. We believe this positive performance is already reflected in the current stock price of $460, given its very high valuation. The stock trades at 28 times its trailing revenues and a significant 122 times its trailing adjusted earnings of $3.73 per share, which is much higher than its three-year average price-to-earnings ratio of about 80x. Furthermore, there's a risk of a broader market downturn, which historically has impacted CrowdStrike's stock more severely than the general market. Also, the growth is slowing. The consensus estimates project average sales growth of 21% over the next couple of years, compared to 40% average growth seen in the last three years. Considering these factors, we do not think now is a good time to buy CRWD stock. Investors would likely benefit from waiting for a further price dip. Surely, we could be wrong. There's a chance investors might continue to value CRWD highly if sales grow faster than expected. But, the risk at the current valuation appears high. In fact, the risk assessment framework is something we focus on while constructing the 30-stock Trefis High Quality (HQ) Portfolio, which has a track record of comfortably outperforming the S&P 500 over the last 4-year period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.
