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Palo Alto Networks, Inc. (PANW)



Palo Alto Networks, Inc. (PANW) is a provider of network security services to large-scale enterprise users. The company is relatively new, founded in 2005 and shipping their first product in 2007, and went public in July 2012. The company has grown very quickly and today they count over...




Palo Alto Networks, Inc. (PANW) is a provider of network security services to large-scale enterprise users. The company is relatively new, founded in 2005 and shipping their first product in 2007, and went public in July 2012. The company has grown very quickly and today they count over 9,000 global customers across multiple industries. Sales have increased by an average of 380% annually over the last five years and profits are starting to ramp up as the company builds scale.

“Palo Alto delivered a strong Q1 2013 performance as revenues increased 14% to $90 million with profits of $0.04 per share. The company introduced two new products including a next generation firewall, and a dedicated high performance management web tool. The company has developed a fundamentally new approach to network security—a next generation firewall that secures a network by user and application. The combination enables control over content. Because the system can control content, it helps prevent data leakage, which is a real concern for many organizations.

“The stock trades at a very high multiple, but it is near its low since the IPO. I believe the company is in a terrific niche market and could be a buy-out target for a larger tech company like Cisco, IBM or Dell. My 12-18 month target price is $75.00 a share.”

Eric Dany, Stock Prospector, January 11, 2013

Eric Dany is 61 years old and has been investing for over 30 years. He has a BSME from Rose-Hulman Institute of Technology (1969) and MBA from the University of Florida (1979). Mr. Dany says his secret to success is finding under-valued stocks and then holding them for substantial gains.