PSE-SASE resources - Palo Alto Networks System Engineer Professional ? SASE (PSE-SASE) Updated: 2024

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Palo Alto Networks (NASDAQ:PANW) is set to continue to benefit from massive demand for cybersecurity even amid possible macroeconomic weakness.

The stock has already rallied in 2023, and is the second best performer among peers after Crowdstrike (CRWD). That could spell its undoing in 2024 if investors think it's overvalued.

2023 Stock Performance

Palo Alto (PANW) is up 117% in 2023. Shares reached a 52-week high of $318 this week. On Friday, the stock climbed 2.3%, to close at $307.30.

Over a five-year timeframe, the stock has advanced more than 389%.

What Quantitative Measures Say

Palo Alto (PANW) has a Hold rating from Seeking Alpha's Quant Rating system. This comes in large part due to an F grade in the category of valuation. The stock also receives a B+ for growth.

Countering this somewhat are high grades in other areas. Palo Alto receives an A+ for profitability and an A for momentum.

What Wall Street Says

Analysts largely love Palo Alto (PANW). Of the 46 analysts surveyed by Seeking Alpha in the past 90 days, 27 of them have a Strong Buy rating and 11 have a Buy rating.

There are skeptics, however. Seven analysts deliver Palo Alto (PANW) a Hold rating, and one gives it a Sell rating.

SA analyst Richard Durant said earlier this month that the stock is starting to look fully valued. Palo Alto is facing headwinds on the hardware side of its business, although, given its current revenue mix, that is not a significant concern, he said.

"There is a risk of growth deceleration as Palo Alto begins to saturate its existing customer base though," Durant said. "Palo Alto’s stock likely continues to do ok going forward, provided the macro environment remains stable, but there may not be much more room for multiple expansion."

In late November, SA author Lighting Rock Research called Palo Alto (PANW) a Buy, noting it is one of the largest cybersecurity companies, with almost 80% of revenue coming from services and subscriptions. The business has evolved from network security to cloud security and, most recently, to the next generation of Security Operations Centers transformation.

"The SEC's new rules on cybersecurity will serve as a notable catalyst for Palo Alto, and I initiate coverage with a 'Buy' rating and a fair value of $290 per share," Lighting Rock said.

Latest Earnings

In its last earnings report, Palo Alto (PANW) reported revenue and profit that topped estimates. Revenue of $1.9B compared to the average analyst estimate of $1.84B and non-GAAP earnings came in at $1.38 per share, above the estimate of $1.16 per share.

Earnings Predictions

Looking ahead, for fiscal 2024, the company expects total billings in the range of $10.7B to $10.8B. That compares to a prior estimate of $10.9B to $11B.

Revenue is forecast in the range of $8.15B to $8.20B versus the estimate of $8.19B and non-GAAP net income per share is forecast in the range of $5.40 to $5.53 compared to the estimate of $5.34 per share.

"An unprecedented level of attacks is fueling strong demand in the cybersecurity market," said CEO Nikesh Arora last month.

Analysts expect the company to report $1.30 in earnings per share for the current quarter on revenue of about $1.97B.

SANTA CLARA, Calif., Dec. 28, 2023 -- Palo Alto Networks today announced that it has completed the acquisition of Talon Cyber Security, a pioneer of enterprise browser technology.

"We are thrilled to welcome Talon to Palo Alto Networks," said Nikesh Arora, chairman and CEO of Palo Alto Networks. "Most work today occurs via web browsers, often on unmanaged devices, which poses enormous security risks. Through the seamless integration of Talon's Enterprise Browser with Prisma SASE, we will be elevating our best-in-class solution that helps provide ironclad security and data protection for all users across all applications and from any device or location. Additionally, we plan to extend Talon's cutting-edge Enterprise Browser technology to our qualified SASE AI customers at no additional cost." 

In today's evolving threat landscape, employees frequently use personal and unmanaged devices to access critical business applications, including using mobile devices alongside corporate laptops. While this approach increases productivity, the lack of consistent security, control and visibility across devices increases security risk.

To tackle these challenges, organizations need a holistic SASE solution that securely enables users to access vital business applications regardless of their chosen device. As part of that SASE solution, Talon's Enterprise Browser will provide additional layers of protection against phishing attacks, web-based attacks and malicious browser extensions.

Talon also offers extensive controls to help ensure that sensitive data does not escape the confines of the browser, regardless of whether the enterprise manages the device.

Palo Alto Networks Prisma SASE is the secure foundation for agile, cloud-enabled organizations. Integrating Talon with Prisma Access can provide customers with substantial productivity benefits by enabling unmanaged devices, but also ensures consistent security and deeper visibility into device usage, all while preserving user privacy.

This acquisition reinforces Prisma SASE's position as the most complete single-vendor SASE solution, enabling customers to adopt a unified SASE approach for complete Zero Trust security. Prisma SASE, along with the Enterprise Browser, are paramount to securing all web applications — public and private — and all devices, both managed and unmanaged.

Learn more about the Talon acquisition here.
Follow Palo Alto Networks on Twitter, LinkedIn, Facebook and Instagram.

The offer of complimentary Talon Enterprise Browser for Palo Alto Networks' qualified SASE AI customers will be available soon.

Palo Alto's latest citizen survey doesn't contain any bombshell findings, but it does point to a welcome shift in residents' opinions about their local government and a troubling one when it comes to municipal utilities.

Like in year's past, an overwhelming majority of the more than 600 residents who responded indicated that they love their parks and neighborhoods and they still believe housing affordability is a massive problem.

But the results of the Annual Citizens Survey, which was conducted by Polco/National Resource Center, also include one finding that should deliver city officials a reason to smile and another that may deliver them pause. Compared to last year, a greater share of residents indicated that they believe their local government is doing a good job and that their city is moving in the right direction. It also, however, showed that more residents are anxious about the city's municipal utilities, an attitude shift that follows a year of sharp fluctuations in gas bills.

The survey, which was conducted in August and September, is intended to be statistically significant, with a margin of error rate of 4%, according to Polco. It's intended to be both an annual vibe check and a precursor to the council's priority-setting process, which takes place in January.

Most findings remained relatively unchanged from prior years. Like in past surveys, about nine in 10 respondents gave the city rave reviews (a "good" or "excellent" rating) when asked about parks, open spaces, libraries, firefighters and recreational activities. About 85% gave Palo Alto high ranks as a place to work (up from 79% in 2022). And while just 53% gave it good ratings as a place to retire (up from 46% in 2022).

Utilities, however, stood out as an area of concern after a year marked by the sharp spike in gas prices last December and January, storm-related power outages and concerns that the city's electrical grid is sufficient. Just 51% of the respondents gave the city Good Marks this year when asked about affordability of utility services, down from 58% in 2022. When it comes to getting a speedy response back from utilities, 75% of the respondents gave Palo Alto high ratings, down from 85% in 2022.

And even though 79% still gave the city high ratings when asked to rate the community value received from owning and operating utilities, this is a drop from 86% in 2022.

The natural gas price spike a year ago forced some bills to double or triple between December and February, but on Dec. 5, council members argued that the results in the Polco poll reflect perceptions more than reality.

They also pointed out repeatedly that the city's utility rates, despite last winter's surge, remain well below those charged by PG&E, the utility company in surrounding communities.

"I was expecting an even worse response on utilities based on those real severe impacts that happened to our ratepayers, and fortunately we are getting back to normal," Council member Pat Burt said during the Dec. 5 hearing.

While both the city utility and PG&E have both raised utility rates over the past year, Burt said the PG&E hikes to electricity rates are about twice as big as Palo Alto's. The gap between the municipal utility and PG&E continues to grow, he said.

Burt and other council members agreed that City of Palo Alto Utilities should do a better job communicating its relatively low rates through inserts in the monthly bill. Council member Julie Lythcott-Haims suggested that doing would enhance residents' appreciation for living in a city with its own utilities.

"When people don't realize how good they've got it, they're more likely to complain about the circumstances," Lythcott-Haims said.

On the bright side, residents were by and large satisfied with the overall performance of their local government. When asked to rate the honesty of the Palo Alto government, 62% gave the city the top two ratings, up from 53% last year and 55% in 2021.

Furthermore, 62% lauded the city for "treating all residents fairly," up from 50% in 2022 and 57% in 2021. And when asked if the city is overall going in the right direction, 54% gave the top two ratings, up from 42% last year and 40% in 2021.

Mayor Lydia Kou said she was pleased to see the city's ratings rise when it comes to "confidence in government," a Topic that she said was a high priority for her.

She cited the council's exact efforts to gain more citizen engagement, including the various town halls that council members and senior staff hosted in neighborhoods throughout the city.

"It's really delightful and commendable that we have kind of come up on that bar," Kou said.

Council member Ed Lauing agreed and said that having more than 50% of the population giving high ratings to their government is "fantastic."

Housing, meanwhile, remains an obvious trouble spot, with 11% of survey respondents giving the city Good Marks when asked about "availability of affordable quality housing" and 26% doing so when asked about "variety of housing options." The rating has been consistently low for the 20 years that the survey has been in existence and has never been higher than 15%.

Lauing summarized the common sentiment as: "It costs way too much to live here but we love it here." Many of the open-ended responses to survey's questions about city performance backed up this assessment. When the survey asked residents to name the one change that the city could make that would make them happier, 23% of the respondents asked for more affordable housing.

"Make it a place that people who aren't millionaires would be able to live," wrote one respondent.

"Stop assuming we all own houses," wrote another.

Housing, however, wasn't the only issue on residents' minds. Many requested that the city do a better job maintaining streets and fixing up El Camino Real (issues related to streets and traffic comprised 15% of the responses, second only to housing).

Others focused on utilities and encouraged the city to either ban gas appliances or to avoid banning gas appliances.

Council member Vicki Veenker also noted that despite a slight dip in public sentiments about Palo Alto as a place to raise children (the percentage giving the city good ratings dropped from 87% in 2022 to 83% in 2023). More troubling is the relatively low percentage of people who called Palo Alto as a place to retire, which went up from 46% to 53% over the past year but which Veenker argued remains too low.

"I think caring for our oldest and youngest residents is something that we really want to keep a close eye on," Veenker said.

A Palo Alto police report, obtained exclusively by NBC Bay Area's Investigative Unit, reveals disturbing details about the California probe of a dog trainer charged in the disappearance of a Peninsula German shepherd and linked to the death of a French bulldog in North Reading, Massachusetts.

The Palo Alto Police Department launched an investigation early this year into Josephine Ragland, 28, after Carolina Bruchilari reported that a dog trainer, she hired through Thumbtack had not returned Scott, her 7-year-old purebred German shepherd on the scheduled date and attempted to return an imposter instead.

On that same day, Bruchilari says Ragland left behind the AirTag that was originally hanging from Scott’s collar.

On Jan. 2, when Ragland was supposed to return Scott to his family in Palo Alto, Ragland texted the owner, saying she had a family emergency, had to leave the dog with a third party and couldn’t facilitate the return, said Bruchilari when NBC Bay Area first interviewed her in January.

NBC Bay Area’s Investigative Unit looked into the bizarre case of a missing dog in the Peninsula. A trainer is accused of losing a German shepard, then trying to cover it up by giving the family another dog. Hilda Gutierrez has an update to a story we exposed earlier this year.

Investigators now say that on the day Ragland was supposed to return Scott, she was busy dropping off and picking up five other dogs from clients all over the Bay Area and passing through Palo Alto, where Bruchilari lives.

Another dog owner, who was also interviewed by police, shared a Ring camera video of that same day showing who appears to be Ragland picking up their dog in the North Bay.

Palo Alto’s report said that investigators reviewed Ragland’s activities around the time she was hired to train Scott, between Dec. 2022 and Jan. 2023 by tracking her phone location, Google accounts, Venmo, Zelle and bank transactions.

This is how they discovered that on the day Ragland did not return Scott. She was actively searching, for what police call “Scott’s substitute,” by sending a “flurry of emails” responding to Craigslist posters who advertised German Shepherds up for adoption.

The very next day, the report states Ragland traveled some 800 miles to Seattle, Washington to pick up the imposter dog and then back to Palo Alto. The Craigslist poster later told police that Ragland arrived solo in a black Tesla and had no idea she intended to deliver the dog to someone else.

This version of events contradicts what Bruchilari says Ragland told her about the substitute dog when she confronted her.

“She told me that she didn't know that it was another dog, that this man gave her another dog," said Bruchilari.

A Humboldt County police report from January indicated that Ragland's boyfriend had come forward, saying Scott was under his care and had broken through a window, leaving a blood trail. He also asked to take the charges linked to his disappearance.

According to the Palo Alto report, the boyfriend promised to send a picture of the broken window to police, but never did. Humboldt County told NBC Bay Area's Investigative Unit that they did not verify the story before forwarding the information to Palo Alto police.

In their report, Palo Alto detectives suggest Ragland and her boyfriend were keeping the dogs in Myers Flat in Humboldt County, more than four hours north of the Peninsula.

A German shepard from Palo Alto disappeared while in the care of a dog trainer. NBC Bay Area’s Investigative Unit has learned the trainer is now facing charges in two different states. Hilda Gutierrez has more.

During a two-month period, Ragland allegedly took in 18 dogs, charging over $2,700 each for two weeks of training, continuing her business as usual even after Scott disappeared.

Clients reported to police and NBC Bay Area that Ragland refused to disclose her training location because of safety concerns, and those who did get their pets back say they received emaciated and visibly neglected dogs.

The Palo Alto report also notes that Ragland had expanded her dog training business to the East Coast under a different name.

In September, Ragland was charged with larceny and misleading police after a Massachusetts French Bulldog died in her care. She has pleaded not guilty to those charges.

In both states, clients told police and NBC Bay Area, they hired Ragland through the online service advertising app Thumbtack because she was verified, had a high rating and dozens of great reviews.

Thumbtack removed Ragland’s profile five days after the initial complaint from Bruchilari and told police they refunded some of Ragland’s clients. But they required them to sign non-disclosure agreements as a condition, something authorities said caused some hesitancy in working with law enforcement, according to the police report.

In a statement, Thumbtack in part said, they were able to verify Ragland’s prior reviews, meaning they were able to confirm they came from genuine Thumbtack customers, and added, "[They] actively encourage all affected customers to speak to the police [and] reached out to those who had engaged with Ragland [going back six months] to let them know she had been banned and that they should not work with her.”

Investigators suggest a possible motive for Ragland's actions, citing at least 10 visits to the Bear River Casino in Loleta during her stay in California, where they say she gambled thousands of dollars during the two-month period.

Police in the East Coast case also noted Ragland's admission of "issues with gambling."

Ragland now faces multiple theft felonies and a warrant for her arrest was issued in Santa Clara County on Nov. 10.

Despite the extensive investigation, the missing German Shepherd has not been located. The Palo Alto Police Department emphasize that the time taken for the investigation is not uncommon and the search for the dog continues.

With the dark days of the pandemic receding ever further in the rearview mirror, Palo Alto is sliding into the new year on a buoyant note.

Its economic outlook has brightened; hotels are once again welcoming visitors; and the City Council is more united than it has been in decades on issues of growth and development. It's not uncommon nowadays for someone to propose an 85-foot height limit for housing projects and no one to object. A few years ago, such a suggestion would inspire the lifting of pitchforks.

There is still, however, plenty of room for reasonable people to disagree. And disagree they did in 2023 — on everything from California Avenue's car-free status and historical designations for homes to zone-busting development proposals and tree protection.

The following five words — universally benign but locally loaded — fueled some of the city's biggest debates of the year.

No. 1: Remedy

In January 2023, housing advocates throughout California began to count down toward the existing and wonkiest holiday on their calendar: Builder's Remedy Day. They were waiting for Jan. 31, the deadline day for Bay Area cities to obtain state certifications for their housing plans, known as "housing elements."

At the time, "builder's remedy" was an abstract and obscure concept, an old provision of state law that allowed housing developers to bypass local zoning regulations in cities that failed to get state approval for their housing elements.

By the end of the year, it became a common buzzword as developers began to pitch increasingly ambitious — and zone-defying proposals — in cities like Palo Alto, which missed the Jan. 31 deadline and will certainly end the year without a state-approved housing plan.

The most exact of these proposals, which was announced in November, would develop two residential towers — 17- and 11-stories in height — and a pavilion building on the site of Mollie Stone's supermarket. At 177-feet tall, the largest tower in this proposal would be the second tallest building in the city and would loom over a business district where height limits for new projects have generally been between 40 and 50 feet.

Mollie Stone's would occupy two stories in the new pavilion building, and the development would net 382 new apartments.

Before builder's remedy, a project of this sort would be unthinkable in Palo Alto's political environment. Now, it's a real possibility.

For some, this remedy is just what the doctor ordered. In late January, a panel of housing advocates from groups Greenbelt Alliance and California YIMBY held an online meeting to educate the public about this new (or rather, dusted-off) tool. Alex Contreras, a housing advocate, cited the "decades of poor land-use policies both at city and state level, leading to all-time low in affordable housing units for folks who need them."

"The builder's remedy is an ‘In case of emergency, break glass' type of situation," she said.

Those who hate Sacramento's housing mandates see this particular "remedy" as far more dangerous than the disease it is trying to cure. Mayor Lydia Kou, who is running for state Assembly, has been arguing that allowing more buildings does not inherently address Palo Alto's biggest housing problem: affordability.

While the law requires developers who rely on builder's remedy to designate at least 20% of their dwellings as affordable housing, Kou and others believe this is a paltry concession for projects that will enrich developers without adequately addressing their impacts on the surrounding neighborhoods.

More troubling, Kou said, is the way state law now allows these projects to override community objections.

"It's a completely undemocratic way of destroying cities and keeping people from speaking up," Kou said.

No. 2: Protected

In 2022, Palo Alto's elected leaders adopted new laws to better protect trees from people.

In 2023, they began to modify these laws to better protect people from trees.

The main driver in this change of direction was Mother Nature. On Dec. 31, 2022, a heavy storm drenched the area, causing flooding around the San Francisquito Creek and causing trees to topple in various parts of town. Then in March, it happened again, prompting fresh concerns from residents about the hazards trees can pose when they fall onto rooftops and powerlines. One local resident saw a large Douglas fir in her backyard crash into her house, puncturing her roof with its branches and causing extensive damage. A few months later, another resident was out with his dog at Rinconada Park when a tree fell on them, temporarily trapping them inside its foliage.

These and other cases prompted the city to reconsider its newly updated tree-protection ordinance, which roughly tripled the number of local trees "protected" from demolition by including in this category almost all trees with diameters of 15 inches or greater (redwoods are subject to an 18-inch threshold).

While the law already included exceptions for damaged, dying and hazardous trees, the changes that the city council will consider early next year would create more flexibility when it comes to removing trees. This would allow trees to be taken out in cases where they are deemed "incompatible with the immediate environment," a "detriment" to adjacent trees or have canopies that encroach on nearby homes in ways not currently meeting the city's criteria for "hazard."

These changes have already received the endorsement of both the city's Parks and Recreation Commission and its Planning and Transportation Commission, with both bodies making the case for giving residents more leeway when it comes to tree removal.

"My sense is this ordinance really prioritizes the lives of trees over the lives of our citizens," Planning and Transportation Commission member Bart Hechtman said during a November hearing on the proposed chances. "I think we need to strike a better balance between those two, and the way we do that is with a little more flexibility."

No. 3: Free

Palo Alto's most divisive debate and most critical decision of the year boiled down to the question: Should California Avenue remain car-free?

For many visitors to the city's "second downtown," the answer was a resounding "Yes!" Since the street was closed to cars in 2020, surveys have consistently shown strong support for maintaining the area between El Camino Avenue and Birch Street as a pedestrian promenade. The city council endorsed this position in November, when it voted to establish California Avenue as a permanent car-free zone. In doing so, it rejected a proposal from city staff to spend another year evaluating options for California Avenue. These could have included an alternative supported by some businesses that would allow car traffic in one direction.

The debate over California Avenue created a split in the business community. Some restaurant owners celebrated the street's new pedestrian atmosphere, which gives visitors freedom to roam the street and eat lunch without having to worry about cars whizzing by a few feet away. Others found this freedom stifling. Many business owners and some residents argued that eliminating car access has been bad for business. Days before the council's vote, a coalition of businesses that included The Cobblery, La Bodeguita del Medio and Mollie Stone's issued a proposal that argued against making the closure permanent.

"While community members support enhanced outdoor dining, many have determined that it cannot exist unless there is a total street closure," the group stated in an opinion column. "But blocking the main artery to the district is cutting off the lifeblood to many businesses, and we believe it's unnecessary."

Now that the council has made its biggest decision for California Avenue, it is preparing for a bunch of smaller ones. On Dec. 18, council members approved a $250,000 contract with a consultant to explore various improvements to the new promenade, including a two-way bike lane and new public attractions (games? music? public plazas?) that would make California Avenue a more vibrant destination.

No. 4: Historic

Palo Alto is famously proud of its rich history, as evidenced by its exact debate over the historic cannery on Portage Avenue and its decades-long effort to create a downtown museum that celebrates the city's contributions to humanity.

But the city's effort to update its historic inventory and add about 150 buildings to the list got off to a rocky start this year, with dozens of property owners signaling that they're not onboard.

As of mid-December, dozens of homeowners have filed written objections to having their properties added to the list, prompting the city to significantly pare down its list of nominees. Over two public hearings in front of the Historic Resources Board, residents complained that the designation would limit (or, at the very least, complicate) their ability to renovate their homes and would lower their property values.

"We certainly appreciate the historical value of our house and want to continue to preserve that," John Baird, whose home is on the list, told the board on Dec. 14. "I don't know that we want to be on a list that removes value from our house in a resale situation."

While the city can technically add historic homes to the local inventory without the property owner's consent, city staff had been loath to go that route. The list that the council will receive next year will identify — and potentially exclude — properties whose owners have objected.

Carolyn Willis, a member of the Historic Resources Board whose home is among those that would be added to the expanded list, argued during the hearings that getting on the list is a good thing because it encourages preservation of the city's historical look and feel.

"I think most of us have choices about where we live, and we chose Palo Alto for a reason," Willis said on Dec. 14. "And at least for me, very much the way it looks and feels is why I'm here today. We see inventory as a positive thing, and we hope to change the public image of that."

No. 5: Safe

When the First Congregational Church of Palo Alto announced its plans last year to launch a "safe parking" program in the back of the church parking lot, neighboring residents took notice. In a heated public hearing, some voiced opposition to the program, which allows congregations to provide up to four parking spaces to unhoused individuals who live in cars.

Some raised concerns about neighborhood safety and demanded that the city require background checks for participants, a step that neither Santa Clara County (which provides funding for the program) nor Move Mountain View (the nonprofit that operates the safe parking program) favor. Similar concerns cropped up the prior year, when the Unitarian Universalist Church of Palo Alto launched its own safe program.

By the time the year came to an end, the council had two years of evidence to suggest that "safe parking" really is safe — both for the participants and the neighbors. As of early December, the first three programs have served 37 individuals and the city has not received a single complaint about any of them. Heartened by these results, the council agreed in December to make the pilot program permanent, to create a path for churches to host up to eight vehicles and to explore the expansion of the city's largest "safe parking" program on Geng Road.

Vice Mayor Greer Stone called the move to expand safe parking "an easy and obvious decision" and a useful tool for addressing the issue of homelessness.

"It's clear the state had failed to address the epidemic," Stone said. "Here in Palo Alto, our policies seem to be having some results.

"One of the greatest successes of this pilot program is the data — or maybe I should really say the lack of data — on safety concerns at the safe parking sites," Stone said.

Looking for more 2023 year-in-review coverage? Read on!

• The year in photos: A final glance at 2023

• In Memoriam: a tribute to Palo Alto area residents we lost in 2023

• The year's top news: A month-by-month lookback at 2023

• The Weekly's year-end news quiz: Can you ace it?

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.