Palo Alto Networks, Inc. (PANW)

FairStock Score: 29/100 — RISKY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

Palo Alto Networks is a real business with mission-critical cybersecurity products, and the top line is moving: filed revenue was $8.0 billion in fiscal 2024 (year ended 2024-07-31), $9.2 billion in fiscal 2025 (year ended 2025-07-31), and $11.5 billion in fiscal 2026 (year ended 2026-07-31). In fiscal Q3 2026 (quarter ended 2026-04-30), revenue was $3.0 billion versus $2.3 billion in fiscal Q3 2025 (quarter ended 2025-04-30). But I care about owner earnings, and profit is uneven. Net income was $2.6 billion in fiscal 2024, $1.1 billion in fiscal 2025, and $307 million in fiscal 2026; diluted EPS fell from $3.64 to $1.60 to $0.40. Fiscal Q3 2026 showed a $177 million net loss and -$0.22 EPS, though fiscal Q1 2026 (quarter ended 2025-10-31) and fiscal Q2 2026 (quarter ended 2026-01-31) were profitable. The balance sheet is conservative, with FairStock-calculated D/E of 0.09 and Altman Z-score of 9.04, and trailing FCF was $4.1 billion. Still, at the 2026-10-26 close of $390.46, FairStock's P/E is 976.15, P/B is 11.58, EV/EBITDA is 223.78, and FCF yield is 1.3%; the Graham Number is $17.42, leaving a -2084.56% margin of safety. ROE is 1.74% and ROCE is 1.40%. FairStock labels it a SLOW GROWER — Shrinking, with profit down 11.3% a year over three years, and its score is 29/100. The franchise may have switching costs, but the price already assumes a lot of future profitability that the filed numbers do not yet show.

In plain English: Palo Alto Networks sells cybersecurity software and services to businesses and governments. Sales are growing fast, but profits have weakened and a recent quarter showed a loss. At $390.46, the stock looks very expensive compared with the company's earnings and cash flow, even though debt is low.

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Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q3 2026 10-Q (period ended 2026-04-30) · fiscal Q2 2026 10-Q (period ended 2026-01-31) · fiscal Q1 2026 10-Q (period ended 2025-10-31) · fiscal Q3 2025 10-Q (period ended 2025-04-30) · FY2026 10-K (period ended 2026-07-31) · FY2025 10-K (period ended 2025-07-31) · FY2024 10-K (period ended 2024-07-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer