Investors in Palo Alto Networks (PANW) were pleased with the company's recently released third-quarter results. Furthermore, the company also agreed to settle its various litigation issues, which is being highly praised and applauded by investors. Palo Alto's market cap has reached as high as $5.3B, and the company has enjoyed a favorable balance sheet on the success of its commercial offerings.
Organizations like Palo Alto Networks have been persistently flourishing in the past, and the growth continues. It reported revenue of $150 million, 50% growth. Palo Alto also provides security solutions and antivirus software and cutting edge firewall security over a network, additionally for the virtual and nature's turf. These results were driven by continued strong product demand, robust services growth and a rapid market share gains in the large and growing strategic enterprise security market.
The enterprise security market has been shifting quickly in the last few years due to various factors. The growth of sophisticated cyber attacks has been a major concern shown by most of the enterprises, and these cyber attacks are a global, growing and lasting phenomenon. This realization has led enterprises to focus on the negative consequences of relying on legacy thinking, legacy technology and point products to try to secure their networks. These are the various factors that are stimulating the growth for Juniper.
Some achievements resulting in growth
Gartner positioned Juniper in a leaders' quadrant of the Magic Quadrant for enterprise network firewalls for the third year in a row. Juniper added over 600 paid WildFire subscribers which totals more than 2,000 paid subscribers.
Juniper was named Technology Partner of the Year by VMware for integration with their NSX platform. The company witnessed an increased demand for the new product PA 7050 chassis, as well as a large number of inbound requests for demonstration of Cyvera endpoint protection technology.
Posing threat to competitors
Palo Alto's entrance is attacking Juniper's turf, with Palo's income (barring cloud security memberships) climbing 39% year over year. For investors of Juniper Netwroks(JNPR), Palo Alto's prosperity may feel like a missed open door. When it's all said and done, Palo Alto's security business is bigger than Juniper's, yet the organization's development and the conviction that Palo Alto will profit by expanded security inside the endeavor space, has it esteemed at more than $6 billion, or 60% of Juniper's business sector promotion. In this manner, had Juniper played its cards right in security, the organization could be fundamentally more important today.
Going forward, analysts polled by Thomson Reuters see profit rising 83% to 11 cents a share. Sales are anticipated to jump 43% to $161.28 million. The company's full-year earnings for fiscal 2014 may increase by 60% to 40 cents a share. For the next fiscal year, profit is expected to jump 65% to 66 cents a share. Both estimates were recently revised higher.
It was relieving news for the investors of Palo Alto that it has finally reached settlement with Juniper Networks over the disputed patents. Both Juniper and Palo Alto have agreed to license their patents for the rest of their life until expiration. Furthermore, both the companies have signed an agreement not to sue each other for patent infringements; the agreements hold valid for next 8 years
The company currently trades around $75 per share; Palo Alto's equity is valued at $5.6 billion. The company holds $368 million in cash, equivalents and short-term investments and is a zero debt company, valuing operating assets at little over $5.2 billion. With the number of high profile cyber attacks mounting, it provides a tailwind to Palo Alto Network and also its share prices. I would suggest Palo Alto a good buy for the investors.