2024-07-26 14:38:40 ET
Summary
- I believe paying 47x next year's EPS for Palo Alto Networks, Inc. is a poor investment due to its slowing growth rates.
- I argue that Palo Alto Networks is a tier-2 company with limited upside potential while being priced at a high premium.
- I see substantial customer cannibalization at play as customers are shifted from legacy products to Next Generation Security products.
Investment Thesis
For some investors, Palo Alto Networks, Inc. ( PANW ) has become a go-to cybersecurity company on the back of CrowdStrike's ( CRWD ) global IT outage disaster. However, I make the case, that Palo Alto is a poor choice to back in light of this gaming-changing event. And that investors would do better to back SentinelOne ( S ) instead. But I get ahead of myself....
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Palo Alto Networks: At Forward 47x EPS, Choose SentinelOne Instead