Tag Archives: cuda

Palo Alto Networks’ Q3 Seen Hitting 2014 Trough Levels Amid Slowdown

Palo Alto Networks ( PANW ) is expected late Thursday to report fiscal Q3 sales and earnings that decelerated to mid-2014 trough levels, with further sales-growth slowing expected in fiscal Q4, according to the consensus of 43 analysts polled by Thomson Reuters. In early afternoon trading on the stock market today , Palo Alto Networks stock was up a fraction, near 145. The rise underperformed IBD’s 26-company Computer Software-Security industry group, which jumped 1.6%. A weak April-quarter earnings report by the company could stoke further questions of a broad cybersecurity slowdown . This month, investment bank Piper Jaffray noted slowing demand for Palo Alto Networks products, citing its own checks of the sales channel. Palo Alto’s results come after soft Q2 and fiscal 2016 guidance from security vendors  Check Point Software Technology ( CHKP ) and FireEye ( FEYE ). Imperva ( IMPV ) and Proofpoint ( PFPT ) likewise missed with their Q2 guidance, and Barracuda Networks ‘ ( CUDA ) and Fortinet ‘s ( FTNT ) full-year views lagged. For fiscal Q3, Palo Alto Networks is expected to report $339.5 million in sales and 42 cents earnings per share minus items, up a respective 45% and 83% vs. the year-earlier quarter. A company faces the prospect of lower percentage growth when it gets bigger, but Q3 sales would decelerate for the fourth consecutive quarter and would dip below 50% growth for the first time since June 2014. For the current fiscal Q4, the analyst consensus calls for 37% year-over-year growth, lagging the 53% growth average Palo Alto has enjoyed the past three years. Q3 EPS, as modeled, would break a five-quarter streak of triple-digit growth and touch a seven-quarter low. But analysts model 79% EPS ex items growth in fiscal Q4, which would top the 55% growth average for Palo Alto’s past three July quarters.

Broad Security Freeze: Palo Alto Demand Stalls; Q2 Views Lukewarm

Palo Alto Networks ( PANW ) stock tumbled Thursday after a Piper Jaffray analyst said that lackluster April demand and Q2 guidance from Check Point Software Technology ( CHKP ), FireEye ( FEYE ) and Imperva ( IMPV ) could signal a broad cybersecurity slowdown. IBD’s 26-company Computer Software-Security industry group is down 18.5% for the year after toppling 32% through Feb. 9, on bleak guidance for IT spending from firms like LinkedIn ( LNKD ) and Tableau Software ( DATA ). Barracuda Networks ( CUDA ), Check Point, FireEye and Fortinet ( FTNT ) recently missed full-year views. Imperva and Proofpoint ‘s ( PFPT ) Q2 outlooks lagged the consensus. Now, channel checks show April demand slowed, Piper Jaffray analyst Andrew Nowinski says. “The key takeaway from Q1 earnings season is that the security sector is starting to show signs of slowing based on the guidance that was provided for Q2 and fiscal 2016,” he wrote in a research report Thursday. Cybersecurity stocks toppled Thursday on Nowinski’s assessment. IBD’s security group was down 2% in morning trading on the stock market today , with Palo Alto Networks and FireEye stocks leading the deluge, down a respective 6% and 4%. Palo Alto Networks stock was at a two-month low, near 130. IBD’s Take: How does Palo Alto Networks stack up, and how does it compare to its rivals? Find out at IBD Stock Checkup But some analysts say Palo Alto Networks could beat guidance when it posts fiscal Q3 earnings on May 26. The company has topped the high-end of its outlook by an average 5.6% for the past 11 quarters. To do so again, Palo Alto would have to report $356 million in sales. The consensus of 43 analysts polled by Thomson Reuters models $339.4 million in April-quarter sales, which would be up 45% vs. the year-earlier quarter. But $549.5 million in July-quarter billings expectations, up 40%, might be too aggressive, Nowinski wrote. During the April quarter, some delays in large contracts likely hurt Palo Alto Networks, Nowinski wrote. “Most (resellers) thought it was simply due to a ‘digestion period’ where customers were still trying to integrate products they purchased in 2015,” he wrote. “The results definitely indicate demand slowed sequentially and also on a year-over-year basis.” Nowinski expects Palo Alto Networks to at least meet estimates, but he cut his price target on Palo Alto Networks stock to 180 from 208. He reiterated an outperform rating, but wrote that “this is the first quarter in at least two years where we picked up any sort of slowdown in Palo Alto’s demand trends.”

Fortinet Crushes Q1 Model; Faces Palo Alto, Cisco With Platform Bet

Fortinet ( FTNT ) topped Wall Street’s Q1 views late Tuesday and threw down a platform gauntlet with a “Security Fabric” that could challenge Palo Alto Networks ( PANW ) and Cisco Systems ( CSCO ), a Dougherty analyst said Wednesday. In afternoon trading on the stock market today , Fortinet stock was up 7.5%, at a four-month high above 33. Shares of fellow cybersecurity firm Barracuda Networks ( CUDA ), meanwhile, were up 17%, at a three-month high near 18, after that company late Tuesday posted a fiscal Q4 and fiscal 2016 beat. But Summit Research analyst Srini Nandury says Barracuda has “too many moving parts” and won’t survive a mass small- and medium-business exodus to cloud products from the likes of Microsoft ( MSFT ) and Amazon.com ’s ( AMZN ) Amazon Web Services. Fortinet Tops On Service Revenue For Q1 ended March 31, Fortinet reported $284.6 million in sales and 12 cents earnings per share minus items, up a respective 34% and 50%, vs. the year-earlier quarter, and topping the consensus for $273.4 million and 9 cents. Billings flew 30% to $330.5 million, above Fortinet’s earlier guidance for $315 million to $322 million. Dougherty analyst Catharine Trebnick credited Fortinet’s sales beat to $160 million in service sales vs. expectations for $150.3 million. Billings from FortiSandbox, which offers advanced threat protection and virtual software, jumped 270% year over year. Bundling also helped drive outperformance, Trebnick wrote in a research report. Fortinet is pushing its “Security Fabric,” which attempts to holistically combine Fortinet’s products under “a single pane of glass.” “We believe this strategy could help incrementally improve margins and would generate more sticky revenue for the company from their SaaS components,” she wrote. “It remains to be seen whether they can outperform competitors such as Palo Alto Networks and Cisco Systems.” Trebnick boosted her price target on Fortinet stock to 40 from 38 and reiterated a buy rating. For Q2, Fortinet guided to sales of $301 million to $306 million, up 27% at the midpoint, and EPS ex items of 14 cents. Billings guidance for $365 million to $370 million would be up 24% at the midpoint. The consensus of 33 analysts polled by Thomson Reuters called for $300.8 million in sales and 15 cents EPS ex items. Barracuda SMB Customers ‘Hijacked’ Barracuda topped Wall Street’s billings and sales views for the first time in four quarters, William Blair analyst Jonathan Ho noted in a report. He reiterated his market perform rating on Barracuda stock, but questioned whether the company could survive the cloud transition. “The Barracuda story looks to have fundamentally changed, with the core value proposition of delivering IT solutions at low cost and complexity to SMB customers being hijacked by public cloud providers,” he wrote. For fiscal Q4 ended Feb. 29, Barracuda reported $83.7 million in sales and 15 cents EPS minus items, up a respective 16% and 114% vs. the year-earlier period, beating the consensus for $80.9 million and 8 cents. Billings were flat at $95.8 million. The company wrapped fiscal 2016 with $320.2 million in sales, 42 cents EPS minus items and $377.5 million in billings, up 15%, 50% and 4%, respectively. Sales and EPS flew past the consensus model of 16 analysts polled by Thomson Reuters for $317.3 million and 35 cents. But fiscal Q1 is expected to decelerate markedly on a year-over-year basis. For the current quarter, Barracuda guided to $83 million to $85 million in sales, 10-11 cents EPS minus items and $94 million to $96 million in billings, up 8%, 2% and 1%, respectively, at the midpoints.