PANW
Palo Alto Networks, Inc.Technology·Cybersecurity
Current Price
$150.56
Market Cap
$100.7B
Net Debt
-$2.9B
Shares Outstanding
0.67B
Financial Statements
| Metric | FY2013 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | TTM (Q2 FY2026) |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $396M | $598M | $928M | $1.4B | $1.8B | $2.3B | $2.9B | $3.4B | $4.3B | $5.5B | $6.9B | $8.0B | $9.2B | $9.8B |
| Revenue Growth | — | 51.0% | 55.1% | 48.5% | 27.8% | 29.0% | 27.6% | 17.5% | 24.9% | 29.3% | 25.3% | 16.5% | 14.9% | 12.7% |
| Operating Income | -$19M | -$215M | -$134M | -$190M | -$180M | -$129M | -$54M | -$179M | -$304M | -$189M | $387M | $684M | $1.2B | $1.5B |
| Operating Margin | -4.7% | -36.0% | -14.4% | -13.8% | -10.2% | -5.7% | -1.9% | -5.3% | -7.1% | -3.4% | 5.6% | 8.5% | 13.5% | 15.4% |
| Net Income | -$29M | -$226M | -$165M | -$226M | -$217M | -$148M | -$82M | -$267M | -$499M | -$267M | $440M | $2.6B | $1.1B | -$189M |
| Net Margin | -7.4% | -37.9% | -17.8% | -16.4% | -12.3% | -6.5% | -2.8% | -7.8% | -11.7% | -4.9% | 6.4% | 32.1% | 12.3% | -1.9% |
| EPS (Diluted) | $-0.14 | $-0.95 | $-0.65 | $-0.83 | $-0.79 | $-0.53 | $-0.28 | $-0.92 | $-1.73 | $-0.90 | $1.28 | $7.28 | $1.60 | $-0.53 |
| Free Cash Flow | $92M | $52M | $316M | $586M | $705M | $925M | $924M | $821M | $1.4B | $1.8B | $2.6B | $3.1B | $3.5B | $3.3B |
| FCF Margin | 23.2% | 8.7% | 34.1% | 42.5% | 40.0% | 40.7% | 31.9% | 24.1% | 32.6% | 32.6% | 38.2% | 38.6% | 37.6% | 33.8% |
Historical Cash Flows
Historical Cash Flows
| ($M) | FY2013 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $396M | $598M | $928M | $1.4B | $1.8B | $2.3B | $2.9B | $3.4B | $4.3B | $5.5B | $6.9B | $8.0B | $9.2B |
| Growth | — | 51.0% | 55.1% | 48.5% | 27.8% | 29.0% | 27.6% | 17.5% | 24.9% | 29.3% | 25.3% | 16.5% | 14.9% |
| EBIT | -$19M | -$215M | -$134M | -$190M | -$180M | -$129M | -$54M | -$179M | -$304M | -$189M | $387M | $684M | $1.2B |
| EBIT Margin | -4.7% | -36.0% | -14.4% | -13.8% | -10.2% | -5.7% | -1.9% | -5.3% | -7.1% | -3.4% | 5.6% | 8.5% | 13.5% |
| NOPAT | -$15M | -$170M | -$105M | -$150M | -$142M | -$102M | -$43M | -$141M | -$240M | -$149M | $261M | $684M | $781M |
| D&A | $10M | $19M | $29M | $43M | $60M | $96M | $154M | $206M | $260M | $283M | $282M | $283M | $343M |
| CapEx | $22M | $36M | $34M | $73M | $163M | $112M | $131M | $214M | $116M | $193M | $146M | $157M | $246M |
| ΔNWC | $0 | $287M | -$568M | $830M | -$97M | $1.2B | -$381M | $826M | -$2.9B | -$1.4B | $202M | $857M | $368M |
| Unlevered FCF | -$27M | -$473M | $458M | -$1.0B | -$148M | -$1.3B | $361M | -$976M | $2.8B | $1.4B | $195M | -$46M | $511M |
DCF Valuation
Adjust the assumptions below to derive your own intrinsic value. All calculations update in real-time.
Perpetuity Growth
$64.63
vs $150.56-57.1%
Exit Multiple
$125.79
vs $150.56-16.5%
Projected Cash Flows
| ($M) | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|
| Revenue | $10.5B | $11.9B | $13.3B | $14.6B | $16.0B |
| Revenue % Chg. | % | % | % | % | % |
| EBIT | $1.9B | $2.4B | $2.9B | $3.4B | $3.8B |
| EBIT Margin | % | % | % | % | % |
| Tax Rate | % | % | % | % | % |
| NOPAT | $1.5B | $1.9B | $2.3B | $2.7B | $3.1B |
| NOPAT Margin | 14.4% | 16.0% | 17.6% | 18.4% | 19.2% |
| D&A | $526M | $594M | $665M | $732M | $798M |
| D&A / Revenue | % | % | % | % | % |
| CapEx | $210M | $238M | $266M | $293M | $319M |
| CapEx / Revenue | % | % | % | % | % |
| Chg. NWC | $105M | $119M | $133M | $146M | $160M |
| NWC / Revenue | % | % | % | % | % |
| Unlevered FCF | $1.7B | $2.1B | $2.6B | $3.0B | $3.4B |
| PV of UFCF | $1.6B | $1.8B | $2.0B | $2.0B | $2.1B |
| Σ PV of UFCF | $1.6B | $3.3B | $5.3B | $7.3B | $9.4B |
%
%
x
Valuation Waterfall
Perpetuity Method
PV of FCFs$9.4B
PV of Terminal Value$30.9B
Enterprise Value$40.3B
Less: Net Debt$2.9B
Equity Value$43.2B
Exit Multiple Method (EV/EBITDA)
PV of FCFs$9.4B
PV of Terminal Value$71.8B
Enterprise Value$81.2B
Less: Net Debt$2.9B
Equity Value$84.2B
Sensitivity Analysis
WACC vs Terminal Growth (Perpetuity)
| WACC \ Terminal Growth | 2.0% | 2.5% | 3.0% | 3.5% | 4.0% |
|---|---|---|---|---|---|
| 8.0% | $77.77 | $83.40 | $90.16 | $98.42 | $108.74 |
| 9.0% | $66.73 | $70.67 | $75.26 | $80.68 | $87.19 |
| 10.0% | $58.46 | $61.34 | $64.63 | $68.42 | $72.85 |
| 11.0% | $52.05 | $54.23 | $56.67 | $59.45 | $62.62 |
| 12.0% | $46.93 | $48.62 | $50.50 | $52.60 | $54.96 |
WACC vs Exit Multiple
| WACC \ Exit Multiple (EV/EBITDA) | 19x | 22x | 25x | 28x | 31x |
|---|---|---|---|---|---|
| 8.0% | $108.71 | $122.83 | $136.95 | $151.07 | $165.18 |
| 9.0% | $104.25 | $117.73 | $131.22 | $144.70 | $158.18 |
| 10.0% | $100.03 | $112.91 | $125.79 | $138.67 | $151.55 |
| 11.0% | $96.02 | $108.33 | $120.65 | $132.96 | $145.27 |
| 12.0% | $92.23 | $104.00 | $115.77 | $127.54 | $139.31 |
Investment Thesis
Palo Alto Networks is the largest cybersecurity company, transitioning to a platformization strategy that consolidates network, cloud, and SOC security. Strong NGS ARR growth and improving GAAP profitability as the business scales.
Bull Case
- +Platformization driving multi-product adoption and larger deals
- +XSIAM (AI-driven SOC) disrupting traditional SIEM market
- +Prisma Cloud and SASE gaining share in cloud-native security
- +Improving operating leverage as subscription revenue scales
Bear Case
- -Platformization discounts pressuring near-term billings growth
- -Intense competition from CrowdStrike, Fortinet, Zscaler
- -High valuation relative to growth leaves little margin for error
- -Customer consolidation could slow if macro deteriorates
Key Catalysts
- →NGS ARR acceleration from platformization deals
- →XSIAM replacing legacy SIEM at large enterprises
- →GAAP operating margin expansion trajectory
- →Large government and regulated industry contract wins
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Disclaimer: This is not investment advice. All projections are estimates based on publicly available data. Past performance does not guarantee future results. Always do your own research before making investment decisions. Last updated: 2026-02-19.