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Palo Alto Networks Downgraded To Hold By Deutsche Bank Amid Increasing Headwinds

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Palo Alto Networks Downgraded To Hold By Deutsche Bank Amid Increasing Headwinds
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Deutsche Bank's Vishal Shah downgraded Palo Alto Networks Inc (NYSE: PANW) to Hold, while lowering his price target considerably from $210 to $150.

The company has been successful with macro demand pressure that others have cited. However, for the first time in over three quarters, Palo Alto Networks doesn't seem so insulated from the macro pressures facing the sector.

Related Link: Pacific Crest On Palo Alto: "Take Advantage Of Buying Opportunities"

Palo Alto did well this quarter with subscription revenue up 69 percent and billings up 61 percent. However, product revenue "growth decelerated to 33 percent from 46–47 percent in prior quarters," Shah noted. Additionally, the earnings beat was only by 2 percent, when generally Palo Alto has beat by 5 percent to 7 percent.

Shah is lowering revenue estimate to $392 million (+38 percent) from $402 million and product revenue estimate to $188 million (+22 percent) from $202 million.

Palo Alto shares are down 12.85 percent trading at $129.14.

Latest Ratings for PANW

DateFirmActionFromTo
Dec 2016Summit Redstone PartnersInitiates Coverage OnHold
Nov 2016BarclaysMaintainsOverweight
Nov 2016JMP SecuritiesMaintainsMarket Outperform

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