Brokerage firms on the sell-side which study Palo Alto Networks, Inc. (NYSE:PANW) stock and where it might be headed, have a short-term consensus target price of $183.238 on the name. Analysts on the sell-side distribute research reports to the Buy-side in order to assist with institutional investment decisions. These reports however can also be obtained by retail investors through a number of different channels.
The most bullish analyst projection sees the stock reaching $210 within the next 12-18 months while the most conservative estimate stands at $150. The sell-side works to get the highest possible price for each stock while providing services in the form of ratings and analysis to the Buy-side.
These market makers issue reports on the stocks they cover and issue Buy, Sell and Hold ratings on the equities they cover. Institutions use these evaluate these recommendations when making strategic investment decisions. Breaking the ratings down, there are 20 Strong Buys, 3 Buys, 3 Hold, 0 Sell and 0 Strong Sell recommendations on the stock. Translating these recommendations into an integer based scaled yields a recommendation of 1.35. This is based on a 1-5 scale, 1 representing a Strong Buy and 5 a Strong Sell.
In addition to stock price targets, sell-side firms pay particular attention to company earnings and projected growth. For the upcoming quarter they are expecting that Palo Alto Networks, Inc. (NYSE:PANW) will post earnings of $-0.27 per share on or around 2016-11-28. This is the Zacks consensus based on the 21 analysts polled by the firm.
Earnings per share is arguably the most important indicator for a company and the shares. Wall Street analysts often spend more time any other individual analyzing the state of a company and its earnings growth potential. Analysts sometimes have close ties with company senior management and executives and have access to information that a normal retail investor might not have. It’s essential to look at the consensus numbers as a whole in order to get a proper grasp of where the sell-side thinks the stock is headed. Analyst revisions of estimates leading up to a quarterly earnings release are also important indicators of how they well they think the company will perform heading into the announcement.
Most recently Palo Alto Networks, Inc. (NYSE:PANW) posted earnings per share of $-0.51 versus the Zacks estimate of $-0.24. This yielded a surprise factor of $-0.27 or a difference of -112.5%. A company that consistently beats on expectations tends to see stock price increases over time. A firm that consistnely misses estimates can often see stock price declines in the days and weeks following earnings.
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