Palo Alto Networks (PANW) Stock Pops 10% as Earnings Impress

  • Palo Alto Networks (PANW) reported billings growth for the fiscal fourth quarter.
  • The company’s board also approved a 3-for-1 stock split.
  • PANW stock is shooting up 10% today as traders absorb these developments.
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Cybersecurity solutions provider Palo Alto Networks (NASDAQ:PANW) released its fiscal fourth-quarter results yesterday. Clearly, the market is pleased with the news; traders are pushing PANW stock more than 10% higher today. Investors are most likely focused on Palo Alto’s impressive revenue and billings growth, although the company’s share split announcement also has people talking.

With a $56 billion market capitalization, Palo Alto is among the biggest U.S. cybersecurity software providers out there. That means investors likely watched the company’s quarterly results with great anticipation. As it turns out, Palo Alto exceeded Wall Street’s expectations on both the top and bottom lines.

One highlight for Q4 was Palo Alto’s total revenue, which rose 27% year-over-year (YOY) to $1.6 billion. The company also swung to a net profit during the period. Specifically, Palo Alto reported GAAP net income of $3.3 million, or 3 cents per share. That’s versus a loss of $119.3 million, or $1.23 per share, in the year-earlier quarter.

Palo Alto Networks Chairman and CEO Nikesh Arora was understandably “pleased” with these results, which “included GAAP profitability for the first time in four years.” Arora pointed to “Next-Generation Security growth, driven by our rapid pace of innovation and strong sales execution” as a notable growth driver.

What’s Happening with PANW Stock?

If any Palo Alto investors were worried about maintaining the $500 level, they can relax for today. In the wake of these quarterly results, PANW stock cleared $550 with ease.

Along with the top- and bottom-line growth, today’s traders may also be celebrating Palo Alto’s billings growth. In particular, the company’s quarterly billings increased 44% YOY to $2.7 billion.

With all of this positive news, it’s going to be difficult for analysts to avoid raising their price targets. In fact, this is apparently already happening. BMO Capital Markets analyst Keith Bachman just increased his price target from $650 to $675, for example.

In case all of this isn’t enough, Palo Alto Networks’ board of directors just officially approved a 3-for-1 stock split. So, don’t be surprised if shares are suddenly cheaper in the near future. Possibly, more retail investors will consider taking a position in Palo Alto Networks soon.

On the date of publication, David Moadel did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

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