Palo Alto Stock Story

PANW
 Stock
  

USD 523.16  6.65  1.29%   

As many rational traders are trying to avoid technology space, it makes sense to focus on Palo Alto Networks a little further and understand how it stands against Servicenow and other similar entities. We are going to recap some of the competitive aspects of both Palo Alto and Servicenow.
Published over two months ago
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Should you exit your Servicenow (NYSE:NOW) and Palo Alto (NASDAQ:PANW) positions after a boost?

By analyzing existing basic indicators between Palo Alto and Servicenow, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Servicenow with a short position in Palo Alto. Check out our pair correlation module for more information.

Let's begin by analyzing the assets.
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Palo Alto has an asset utilization ratio of 170.04 percent. This indicates that the company is making $1.7 for each dollar of assets. An increasing asset utilization means that Palo Alto Networks is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two companies, such as Palo Alto or Alphabet is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

How important is Palo Alto's Liquidity

Palo Alto financial leverage refers to using borrowed capital as a funding source to finance Palo Alto Networks ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Palo Alto financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Palo Alto's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
It is good to see analyst projects for Palo Alto, but it might be worth checking our own buy vs. sell analysis

Correlation Between Palo Alto and Alphabet Cl C

In general, stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Palo Alto together with similar or unrelated positions with a negative correlation. For example, you can also add Alphabet to your portfolio. If Alphabet is not perfectly correlated to Palo Alto it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Palo Alto for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Please check pair correlation details between PANW and GOOG for more information.

Note

Are you currently holding both Palo Alto and Alphabet in your portfolio?
Please note if you are using this as a pair-trade strategy between Palo Alto and Alphabet, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses.

Breaking it down a bit more

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Let me now analyze Palo Alto revenue. Based on the latest financial disclosure, Palo Alto Networks reported 4.86 B of revenue. This is 19.24% higher than that of the Technology sector and significantly higher than that of the Software—Infrastructure industry. The revenue for all United States stocks is 48.49% higher than that of Palo Alto. As for Servicenow we see revenue of 5.53 B, which is much higher than that of the Software—Infrastructure

Palo Alto4.86 Billion
Sector0.0
Servicenow5.53 Billion
4.9 B
Palo Alto
Sector
5.5 B
Servicenow

Palo Alto has 99 percent chance to finish above $428 in June

Latest Risk Adjusted Performance is up to -0.07. Price may fall again. Palo Alto Networks exhibits very low volatility with skewness of 0.54 and kurtosis of 2.33. However, we advise investors to further study Palo Alto Networks technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Palo Alto's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Palo Alto's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Palo Alto Implied Volatility

Palo Alto's implied volatility exposes the market's sentiment of Palo Alto Networks stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Palo Alto's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Palo Alto stock will not fluctuate a lot when Palo Alto's options are near their expiration.

The Current Takeaway on Palo Alto Investment

While some other companies in the software—infrastructure industry are either recovering or due for a correction, Palo Alto may not be performing as strong as the other in terms of long-term growth potentials. The inconsistency in the assessment between current Palo Alto valuation and our trade advice on Palo Alto is due to the recent market swings and your selection of investing horizon. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Palo Alto.

Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Palo Alto Networks. Please refer to our Terms of Use for any information regarding our disclosure principles.

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