Palo Alto Networks Inc

PANW
About the company

Palo Alto Networks, Inc. provides cybersecurity solutions in the Americas, Europe, the Middle East, Africa, the Asia Pacific, and Japan. It offers Prisma Access, a secure access service edge solution; Strata Cloud Manager, a network security management solution; and Prisma AIRS to protect customers' entire AI ecosystem.

Country: United StatesPrice: $388.41Market Cap: $317.7B

Investment snapshot

25%positive consensus
Scored 37d ago

Positive

4

BUY / PASS

Neutral / negative

2 / 9

NEUTRAL / FAIL

Median fair value

$23.37

-94.0% vs price

Models with upside

0 / 16

Positive margin of safety

Strongest signal

7 of 11 pass — Lynch, Schloss, Dreman +1 more object

Key risk

No clean pass — all 12 investors flag at least one valuation criterion

Framework analysis

VerdictMeaning
BUYPositive purchase signal: the framework's buy requirements are met.
PASSThe company clears the framework's checklist or screen, but the framework does not produce a buy signal. For valuation frameworks this often means margin of safety is missing, insufficient, or unavailable; some screen-only frameworks have no intrinsic-value BUY state.
NEUTRALNeither a positive nor negative conclusion. It does not mean to hold an existing position.
FAILThe company does not clear the framework's requirements.
RankedRanked strategies do not use PASS: selected cohort is BUY, outside the cohort is FAIL, and unranked is NEUTRAL.
Scored from 10-K37d ago
MetricO'Shaughnessy

Systematic Factor Composite

Lynch

GARP

Buffett

Quality Compounder

Pabrai

Dhandho Framework

Akre

Three-Legged Stool

Schloss

Asset-Value Discipline

Neff

Low-P/E Total Return

Sleep

Scale Economies Shared

Templeton

Global Bargain Hunter

Marks

Risk-Aware Value

Munger

Quality Focus

Ackman

Activist Value

Dreman

Contrarian Value

Piotroski

F-Score

Greenblatt

Magic Formula

Graham

Defensive Value

VerdictNEUTRALFAILFAILFAILNEUTRALFAILFAILPASSFAILFAILPASSPASSFAILPASSNot rankedFAIL
Score
Analysis
Intrinsic ValueN/AN/AN/AN/AN/AN/AN/AN/AN/AN/A
Margin of SafetyN/AN/A-1685.8%-1454.9%N/AN/AN/AN/AN/AN/A-311.0%-109.0%N/AN/A-4163.6%-1792.8%
Data As Of10-K (2026-08-25)10-K (2026-08-25)10-K (2026-08-25)10-K (2026-08-25)10-K (2026-08-25)10-K (2026-08-24)10-K (2026-08-24)10-K (2026-08-23)10-K (2026-08-23)10-K (2026-08-23)10-K (2026-08-23)10-K (2026-08-23)10-K (2026-08-23)10-K (2026-08-23)10-K (2026-08-23)10-K (2026-08-23)

Where It Passes

  • Debt & Leverage64% pass✓ 10✗ 4▾

    7 of 11 pass — Lynch, Schloss, Dreman +1 more object

    Total Debt / Equity0
    ✓Lynch< 0.33
    Cash - Long-term Debt
    ✗LynchPositive preferred
    Debt/Equity & Interest CoverageD/E: 0.00, IC: 414.3x
    ✓BuffettD/E < 0.5 AND Interest Coverage > 5x
    Debt Levels0
    ✓AkreDebt/Equity < 0.3✓MungerDebt/Equity < 0.5
    Total Debt / Shareholders' Equity0.00x
    ✓SchlossD/E < 1.00x✓Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✓Dreman< 0.8
    Current Assets / Current Liabilities0.94x
    ✗SchlossCurrent ratio >= 1.50x (app cutoff)✗Dreman> 1.5
    Interest Coverage & Debt/EBITDAIC=414.3x, D/EBITDA=0.0x
    ✓MarksInterest Coverage > 3x; Debt/EBITDA < 4x
    Total Debt / Shareholders Equity0
    ✓Ackman<= 1.0
    LT Debt / Total Assets Change0.00% -> 0.00%
    ✓PiotroskiDecreased YoY
    LT Debt vs Net Current Assets
    ✗GrahamLT Debt <= Net Current Assets
  • Cash Flow60% pass✓ 7✗ 5▾

    6 of 10 pass — Oshaughnessy, Pabrai, Ackman +1 more object

    (Operating cash flow - capex) / market capitalization+1.09%; #2354/4487 (top 52.5%)
    ✗OshaughnessyTop 10% of eligible cross-section
    FCF Positive and Growing$3.5B
    ✓LynchPositive and growing
    Free Cash Flow Proxy$1.2B
    ✓BuffettPositive and growing
    P/E or FCF YieldP/E=242.8x, FCF Yield=1.1%
    ✗PabraiP/E < 15 or FCF Yield > 10%
    Operating Cash Flow - Capital Expenditures$3.5B
    ✓Neff> $0 (app proxy for a strong fundamental case)
    Positive Operating Cash Flow frequency15/15 years positive
    ✓SleepPositive OCF in >= 70% of available years
    FCF Positive15/15 years FCF positive
    ✓MarksPositive FCF in majority of recent years
    (OCF - CapEx) / Market Cap1.3%
    ✗Ackman>= 4%
    Price / FCF per Share74.9x
    ✗Ackman<= 25
    Price / (CFO / Shares)69.9x
    ✗Dreman< 8x
    Operating Cash Flow$3.7B
    ✓PiotroskiCFO > 0
    (CFO / Total Assets) vs ROACFO/Assets=15.76%, ROA=4.81%
    ✓PiotroskiCFO/Assets > ROA

Where It Falls Short

  • Valuation0% pass✓ 1✗ 25▾

    No clean pass — all 12 investors flag at least one valuation criterion

    Revenue / market capitalization+0.0290; #4643/5203 (top 89.2%)
    ✗OshaughnessyTop 10% of eligible cross-section
    Net income / market capitalization+0.36%; #3004/6251 (top 48.1%)
    ✗OshaughnessyTop 10% of eligible cross-section
    (Operating cash flow - capex) / market capitalization+1.09%; #2354/4487 (top 52.5%)
    ✗OshaughnessyTop 10% of eligible cross-section
    Trailing six-month price return through the evaluation date+142.27%; #233/6203 (top 3.8%)
    ✓OshaughnessyTop 10% of eligible cross-section
    Basic earnings-growth PEG (dividends excluded)P/E 242.8x (growth N/A)
    ✗Lynch< 1.0 (ideally < 0.5)
    P/E or FCF YieldP/E=242.8x, FCF Yield=1.1%
    ✗PabraiP/E < 15 or FCF Yield > 10%
    Price / Book Value per Share33.20x
    ✗SchlossP/B <= 0.80x (app cutoff)✗Templeton< 1.5x✗Dreman< 1.2x
    Price / Tangible Book Value per Share104.13x
    ✗SchlossP/TBV <= 1.00x (app cutoff)
    Book Value per Share Change
    ✗SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)
    Price / Diluted EPS242.8x
    ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)
    (EPS CAGR % + Dividend Yield %) / P/E
    ✗Neff> 0.7 (Neff's published traditional edge)
    Price / EPS242.8x
    ✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)✗Dreman< 12x
    Price vs. Trailing Low261% of trailing low ($148.92)
    ✗Templeton<= 120% of trailing low (certified split-adjusted live window)
    P/B or P/E vs. Historical AverageP/E=242.8x, P/B=33.2x
    ✗MarksP/E < 15 or P/B < 2.0
    Discount to Intrinsic Value
    ✗Marks>= 20% below intrinsic value
    Valuation ReasonablenessP/E=242.8x, OE Yield=0.5%
    ✗MungerP/E < 25 or Owner Earnings Yield > 5%
    Price / FCF per Share74.9x
    ✗Ackman<= 25
    Price / (CFO / Shares)69.9x
    ✗Dreman< 8x
    EBIT / Enterprise Value0.4%
    ✗Greenblatt> 10%
    Earnings Yield + ROC AssessmentEY=0.4%, ROC=N/A (invested capital <= 0)
    ✗GreenblattBoth EY > 10% and ROC > 25%
    Price / 3-yr avg EPS
    ✗Graham<= 15x
    Price-to-Book Ratio33.2x
    ✗Graham<= 1.5x
    P/E x P/B
    ✗Graham<= 22.5
  • Growth0% pass✓ 3✗ 10▾

    No clean pass — all 8 investors flag at least one growth criterion

    Basic earnings-growth PEG (dividends excluded)P/E 242.8x (growth N/A)
    ✗Lynch< 1.0 (ideally < 0.5)
    3-5 Year EPS CAGR
    ✗Lynch15-30% (Fast Grower); > 0% to pass
    Inventory Growth vs Revenue GrowthInv: -2.2% vs Rev: 14.9%
    ✓LynchInventory growth < Revenue growth
    3-5 Year Diluted EPS CAGR
    ✗Neff7%-20% annualized
    Revenue growth vs. gross and operating margin trendgross margin 72.3% -> 73.4%, operating margin 5.6% -> 13.5%
    ✗SleepRevenue rising; gross margin flat or falling; operating margin holding
    5-year Revenue CAGR22.0%
    ✓SleepCAGR > 7%
    5-Year EPS CAGR
    ✗Templeton> 0% (5-year EPS CAGR)
    Positive Net Income Frequency4/15 years positive
    ✗MarksPositive net income in >= 7 of last 10 years
    3yr Median Revenue Growth16.5%
    ✓Ackman>= 5%
    Positive EPS Growth Frequency
    ✗AckmanPositive EPS growth in >= 3 of last 5 years
    EPS Growth Direction
    ✗DremanPositive over recent years
    EPS CAGR
    ✗Dreman> 5% annualized
    EPS Growth (3-yr avg, 10-yr window)
    ✗Graham>= 33% growth
  • Efficiency0% pass✓ 2✗ 9▾

    No clean pass — all 8 investors flag at least one efficiency criterion

    ROIC (3-5 yr avg)4.1%
    ✗Buffett> 10%
    ROIC - WACC-5.9%
    ✗BuffettPositive (WACC = 10%)
    ROIC (high and growing)FY2023: ROIC=8.2%; FY2024: ROIC=8.8%; FY2025: ROIC=12.5%
    ✗AkreLatest 3 consecutive FYs: ROIC > 15% in each
    Reinvestment Rate x ROIC12.5% (RR=100% x ROIC=12.5%)
    ✓AkreReinvestment Rate * ROIC > 10%
    ROIC (5-year)1/5 years above 12% (latest 12.5%)
    ✗SleepROIC > 12% in a majority of years
    Return on Invested Capital12.5%
    ✗Munger> 15%
    Current Assets / Current Liabilities0.94
    ✗Dreman> 1.5
    Current Ratio Change YoY0.89 -> 0.94
    ✓PiotroskiIncreased YoY
    Revenue / Total Assets Change YoY0.40x -> 0.39x
    ✗PiotroskiImproved YoY
    EBIT / (NWC + Net Fixed Assets)N/A (invested capital <= 0)
    ✗Greenblatt> 25%
    Current Ratio0.94
    ✗Graham>= 2.0
  • Valuation models0% pass✗ 6▾

    PANW overvalued: all 6 models price fair value below $388.41 (median $23.37)

    Buffett fair value$21.75
    ✗Buffett-1685.8% margin vs $388.41
    Pabrai fair value$24.98
    ✗Pabrai-1454.9% margin vs $388.41
    Munger fair value$94.50
    ✗Munger-311.0% margin vs $388.41
    Ackman fair value$185.83
    ✗Ackman-109.0% margin vs $388.41
    Greenblatt fair value$9.11
    ✗Greenblatt-4163.6% margin vs $388.41
    Graham fair value$20.52
    ✗Graham-1792.8% margin vs $388.41
  • Profitability13% pass✓ 8✗ 23▾

    13 of 15 flag PANW's profitability — Oshaughnessy, Lynch, Buffett +10 more

    Net income / market capitalization+0.36%; #3004/6251 (top 48.1%)
    ✗OshaughnessyTop 10% of eligible cross-section
    Basic earnings-growth PEG (dividends excluded)P/E 242.8x (growth N/A)
    ✗Lynch< 1.0 (ideally < 0.5)
    3-5 Year EPS CAGR
    ✗Lynch15-30% (Fast Grower); > 0% to pass
    ROE14.5%
    ✗Lynch> 15%
    Net Income Positive (10+ years)4/16 years positive
    ✗BuffettPositive every year for 10+ years
    ROE (up to 5-year arithmetic mean)-23.3%
    ✗Buffett> 15% arithmetic mean (app rule)
    Operating Margin (10-yr trend)13.5% (latest)
    ✓BuffettStable or rising over 10 years
    Free Cash Flow Proxy$1.2B
    ✓BuffettPositive and growing
    Earnings Variance (10-yr CoV)
    ✗BuffettCoV < 0.3
    Retained Earnings Effectiveness
    ✗Buffett$1 retained -> > $1 market value created
    Margin of SafetyP/E=242.8x, P/B=33.2x
    ✗PabraiP/B < 1.5 or P/E < 15
    Return on Equity29.8% (3-yr avg)
    ✓AkreROE > 20% (3-year avg)
    Positive Diluted-EPS Years3/10 years positive
    ✗Schloss>= 70% positive over 5-10 observed years (app rule)
    3-5 Year Diluted EPS CAGR
    ✗Neff7%-20% annualized
    Revenue growth vs. gross and operating margin trendgross margin 72.3% -> 73.4%, operating margin 5.6% -> 13.5%
    ✗SleepRevenue rising; gross margin flat or falling; operating margin holding
    5-Year EPS CAGR
    ✗Templeton> 0% (5-year EPS CAGR)
    Operating Margin Trend5.6% (2023) -> 13.5% (2025)
    ✓TempletonNon-negative operating-margin trend over 3 years
    Discount to Intrinsic Value
    ✗Marks>= 20% below intrinsic value
    Positive Net Income Frequency4/15 years positive
    ✗MarksPositive net income in >= 7 of last 10 years
    Operating Income / Revenue13.5%
    ✗Ackman>= 15%
    Net Income / Shareholders Equity14.5%
    ✗Ackman>= 15%
    Pre-Tax Income / Revenue17.3%
    ✓Dreman>= 8%
    Net Income / Shareholders' Equity14.5%
    ✓Dreman> 12%
    Net Income / Total Assets4.81%
    ✓PiotroskiROA > 0
    ROA Change YoY12.89% -> 4.81% (delta: -8.08%)
    ✗PiotroskiCurrent ROA > Prior ROA
    (CFO / Total Assets) vs ROACFO/Assets=15.76%, ROA=4.81%
    ✓PiotroskiCFO/Assets > ROA
    Gross Margin Change YoY74.3% -> 73.4%
    ✗PiotroskiImproved YoY
    EBIT / Enterprise Value0.4%
    ✗Greenblatt> 10%
    Earnings Yield + ROC AssessmentEY=0.4%, ROC=N/A (invested capital <= 0)
    ✗GreenblattBoth EY > 10% and ROC > 25%
    Positive EPS (10 years)3/16 years positive
    ✗GrahamPositive EPS every year for 10 years
    EPS Growth (3-yr avg, 10-yr window)
    ✗Graham>= 33% growth
  • Verdicts31% pass✓ 4✗ 9▾

    Split decision: 9 FAIL · 4 PASS · 2 NEUTRAL

    Overall verdict
    •OshaughnessyNEUTRAL (Not ranked)✗LynchFAIL (3/7)✗BuffettFAIL (3/9)✗PabraiFAIL (0/3)•AkreNEUTRAL (4/6)✗SchlossFAIL (1/7)✗NeffFAIL (2/6)✓SleepPASS (3/6)✗TempletonFAIL (3/8)✗MarksFAIL (2/5)✓MungerPASS (2/4)✓AckmanPASS (4/9)✗DremanFAIL (4/11)✓PiotroskiPASS (F-Score 5)•GreenblattNot ranked✗GrahamFAIL (1/9)

Business & financials

Company Profile

Industry: Computers
SIC Sector: Industrial Machinery & Computing
Size: Mega Cap($317.7B)
Revenue: $9.2B+14.9% YoY
Net Income: $1.1B-56.0% YoY

Financial Snapshot

Operating Margin13.5%
Return on Equity14.5%
Debt / Equity0.00
Current Ratio0.94
EPS (Diluted)$1.60−78.0% 1y
Buybacks (1y)$0
Buybacks (2y)$566.7M
Shares Retired−2.9% / −8.4% 2y

Similar Companies

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$4.81T
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Shareholder Return

Fiscal 2025

Issued 2.9% of shares last year, 8.4% issued over two.

Buybacks
$0
Dividends
—

What drove EPS

A buyback raises earnings per share without the company earning more. This splits each year's change into the two.

FY24
468.8% = 486.2% + −3.0%
FY25
−78.0% = −56.0% + −50.0%
Earnings Fewer shares More shares

The two parts do not sum exactly to the total — the difference is the cross-term, plus preferred capital where the company has any. It is left visible rather than distributed into the other two.

Share count is the denominator the filer used for diluted EPS, recovered as net income ÷ EPS — not the balance-sheet count, which is a point-in-time figure and would put the timing difference into this split. Years with a loss are omitted: a smaller share count makes a loss per share larger, so the decomposition inverts.

Company Financials

Annual data (10-K) · Last 5 years

MetricFY 2025FY 2024FY 2023FY 2022FY 2021
Market Cap$317.7B$60.0Best.$52.2Best.$7.9Best.$8.4Best.
Revenue$9.2B↑15%$8.0B↑16%$6.9B↑25%$5.5B↑29%$4.3B
Operating Income$1.2B↑82%$683.9M↑77%$387.3M↑305%-$188.8M↑38%-$304.1M
Net Income$1.1B↓56%$2.6B↑486%$439.7M↑265%-$267.0M↑46%-$498.9M
EPS (Diluted)$1.60↓78%$7.28↑469%$1.28↑147%$-2.71↑48%$-5.18
Gross Margin73.4%↓1%74.3%↑3%72.3%↑5%68.8%↓2%70.0%
Operating Margin13.5%↑58%8.5%↑52%5.6%↑264%-3.4%↑52%-7.1%
ROE14.5%↓71%49.9%↑98%25.1%↑120%-127.1%↓62%-78.6%
Total Debt$0↓100%$963.9M↓52%$2.0B↓46%$3.7B↑14%$3.2B
Shareholders' Equity$7.8B↑51%$5.2B↑196%$1.7B↑733%$210.0M↓67%$634.5M
Current Ratio0.94↑6%0.89↑14%0.78↑1%0.77↓15%0.91
Debt / Equity0.00↓100%0.19↓84%1.14↓93%17.51↑244%5.08
Operating Cash Flow$3.7B↑14%$3.3B↑17%$2.8B↑40%$2.0B↑32%$1.5B
Free Cash Flow$3.5B↑12%$3.1B↑18%$2.6B↑47%$1.8B↑29%$1.4B

Score history

Historical Score Timeline

Industry peers

Industry Peers

Similar companies in Computers

PANW vs Peers — Financial Grading

Revenue$9.2BBottom 25%
Net Income$1.1BBottom 25%
ROE14.5%Bottom 25%
D/E0.00Top 25%
Op. Margin13.5%Bottom 25%
Curr. Ratio0.94Bottom 25%
CompanyMarket CapPriceRevenueNet IncomeROED/EOp. MarginCurr. RatioGrahamBuffettLynchGreenblattPiotroskiDreman
Apple Inc.AAPL$4.81T$329.40$416.2B$112.0B151.9%1.2332.0%0.891/95/93/71/3F-Score 83/11
CISCO SYSTEMS, INC.CSCO$420.8B$106.74$56.7B$10.2B21.7%0.6020.8%1.004/96/93/70/3F-Score 85/11
Seagate Technology Holdings plcSTX$209.0B$921.51$12.2B$3.2B146.9%1.6533.6%1.673/95/94/71/3F-Score 86/11
INTERNATIONAL BUSINESS MACHINES CORPIBM$207.3B$219.99$67.5B$10.6B32.4%1.88—0.963/92/93/70/3F-Score 64/11
WESTERN DIGITAL CORPWDC$163.5B$453.48$9.5B$1.9B35.6%1.3124.5%1.081/91/92/71/3F-Score 33/11
Fortinet, Inc.FTNT$130.2B$175.96$6.8B$1.9B149.8%0.8130.7%1.172/95/93/71/3F-Score 63/11
Hewlett Packard Enterprise CoHPE$81.6B$61.49$34.3B$57.0M0.2%0.91-1.3%1.011/90/91/70/3F-Score 42/11
NetApp, Inc.NTAP$41.1B$209.18$6.2B$1.3B94.4%1.8426.8%1.443/95/93/71/3F-Score 85/11