Important points
- Palo Alto Networks shares fell nearly 9% in after-hours trading on Monday after the cybersecurity company reported lackluster guidance for the current quarter and full year.
- The company's subdued guidance raises concerns about its recent shift to a unified cybersecurity platform aimed at driving growth among cautious business customers.
- Palo Alto Networks stock has found support between $281 and $295 based on its 50-day moving average and price movement over the past five months.
Palo Alto Networks (PANW) stock fell nearly 9% late Monday after the cybersecurity company released lackluster current quarter and full-year guidance, but the stock remains a buy near a major zone of chart support. It may attract interest.
Palo Alto Networks' stock price has been on a cautious upward trend since returning to its 200-day moving average (MA) in early April, rising above its 50-day moving average in the second half of the month. Trading volume has increased over the past week, indicating continued bullish momentum heading into the company's quarterly results. However, that positive sentiment looks set to come to an abrupt end on Tuesday as the company's outlook is lackluster.
Investors should keep an eye on the $281 to $295 area on the chart amid earnings-related selling. This area is where the price finds a support zone based on the 50-day moving average and historical price movements over the past five months.
The stock closed after-hours trading at $295.61, down 8.7% from the close of regular trading.
A lackluster outlook leaves no impression.
The Silicon Valley-based company expects revenue of $2.15 billion to $2.17 billion for its fiscal fourth quarter, which ends in July, with the midpoint of $2.16 billion expected in the In line with the list's predictions. After accounting for deferred revenue, the company expects current-year charges to be in the range of $3.43 billion to $3.48 billion, compared to expectations of $3.45 billion.
For the full year, the company kept its billing guidance relatively unchanged, expecting it to be in the range of $10.13 billion to $10.18 billion, compared to its previous estimate of $10.1 billion to $10.2 billion.
The company recently pivoted to an integrated security platform as part of its efforts to pursue growth as businesses become more cautious about spending on cybersecurity solutions, offering things like free product offers to attract companies to sign up. We offer a variety of initiatives.
“The minor revision to full-year FY24 guidance falls short of indicating a meaningful pick-up in momentum, with downstream benefits from increased platform purchases from large customers yet to be seen. This was reflected in the lackluster guidance for the fourth quarter,” Third Bridge said. Analyst Jordan Berger said: Reuters.
For the three months ended April 30, the cybersecurity giant posted adjusted earnings of $1.32 per share on net sales of $1.98 billion. Both measures beat analysts' expectations of $1.25 per share and $1.97 billion, respectively. However, his bill for this period was $2.33 billion, slightly below the consensus of his $2.34 billion.
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