not vested
Wedbush chose Palo Alto Networks (NYSE:PANW) as another outperform in the cybersecurity space.
The stock trades at just below $200 per share currently. Wedbush initiated a 12-month price target of $225 per share for PANW stock.
PANW’s next generation firewall products protect cloud networks. As such, their business has grown with the cloud. PANW boasts over 54,000 customers around the world, including 85% of the Fortune 100. In 2017, Fortune rated Palo Alto as one of the “50 companies changing the world.”
The growth figures, both from the past and from projections, both reflect this success. The company saw average an annual profit growth rate of 79.2% per year over the last five years.
While analysts believe that average annual growth will slow to 30.6% per yearfor the next five, they will remain among the fastest-growing cybersecurity stocks.
Even with this growth, the P/E ratio comes in at just over 40. While this makes PANW a bit expensive, it remains far from the triple-digit P/E ratios seen in other tech stocks.
Investors should also note that the 52-week high of $239.50 per share stands above Wedbush’s $225 per share price target. The PANW stock price has more than doubled from levels seen in early 2017. However, a correction beginning in September has taken the stock down by about 15%.
Still, I agree with Wedbush and believe the correction constitutes a hiccup in a long-term uptrend. With the massive growth and the company’s leadership in cloud security, I think the PANW stock price will reach and move beyond the $225 per share price target.
Source: Investor Place