Summit Redstone Starts Palo Alto Networks (PANW) at Hold

Summit Redstone initiates coverage on Palo Alto Networks (NYSE: PANW) with a Hold rating and a price target of $120.00.

Analyst Srini Nandury commented, "While we believe Palo Alto Networks has a compelling technology and established itself as a market leader in the next-gen firewall segment, we remain on the sidelines and look for a better entry point. The stock is currently trading at 6.0x C2017 EV/sales, inline with its high growth peer group average."

He added, "For the stock to work from current levels the multiple needs to expand. That is only possible if the company can provide evidence that its licensing revenue can accelerate, it continues to beat estimates handily and provides guidance that is significantly above consensus. With its two most popular subscriptions (Threat Prevention and URL Filtering) nearing saturation levels, concerns emerging on the growth of licensing revenue and the continued ability to take share from rivals, we believe the stock will remain range bound in the near-term. Therefore, we are waiting for a better entry point."

For an analyst ratings summary and ratings history on Palo Alto Networks click here. For more ratings news on Palo Alto Networks click here.

Shares of Palo Alto Networks closed at $129.62 yesterday.

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