Chowdhry: Amazon & Microsoft Make Palo Alto 'Irrelevant'

Global Equities Research analyst Trip Chowdhry sees the cloud services provided by Amazon.com, Inc. AMZN and Microsoft Corporation MSFT as the end of the road for Palo Alto Networks Inc PANW. According to Chowdhry, Palo Alto simply won’t be able to compete with its larger rivals in the long-term.
 

“Basically, in the world of SuperClouds- Amazon.com AWS and Microsoft Azure, Palo Alto Networks [has] zero play… secular growth is absent in PANW,” Chowdhry explains.

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Chowdhry went on to describe a cloud computing environment that will ultimately be very unkind to the smaller players and their shareholders.

“Amazon.com’s AWS and Microsoft Azure are creating completely new ecosystems comprising Software Developers, Testers, Cloud Service Providers, PaaS Providers and SaaS Providers,” he notes.

Chowdhry sees the increasing dominance of Microsoft and Amazon as a “secular negative” for Palo Alto, NetApp Inc. NTAP, Cisco Systems, Inc. CSCO, Juniper Networks, Inc. JNPR, Arista Networks Inc ANET, Rackspace Hosting, Inc. RAX, VMware, Inc. VMW, Teradata Corporation TDC, Akamai Technologies, Inc. AKAM, Pure Storage Inc PSTG, F5 Networks, Inc. FFIV and others.

Palo Alto shares are down more than 12.0 percent in Friday’s session after the company issued weaker-than-expected forward guidance.

Disclosure: the author holds no position in the stocks mentioned.