Head-To-Head Analysis: Palo Alto Networks (PANW) & PayPal Holdings (PYPL)
Palo Alto Networks (NYSE: PANW) and PayPal Holdings (NASDAQ:PYPL) are both large-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, risk, valuation, profitability, institutional ownership and dividends.
Volatility & Risk
Palo Alto Networks has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500. Comparatively, PayPal Holdings has a beta of 0.98, indicating that its share price is 2% less volatile than the S&P 500.
Insider & Institutional Ownership
76.9% of Palo Alto Networks shares are owned by institutional investors. Comparatively, 82.4% of PayPal Holdings shares are owned by institutional investors. 4.8% of Palo Alto Networks shares are owned by company insiders. Comparatively, 6.0% of PayPal Holdings shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
This is a summary of current ratings for Palo Alto Networks and PayPal Holdings, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Palo Alto Networks||1||11||29||0||2.68|
Palo Alto Networks currently has a consensus target price of $161.18, indicating a potential upside of 9.50%. PayPal Holdings has a consensus target price of $69.97, indicating a potential downside of 3.56%. Given Palo Alto Networks’ higher possible upside, equities analysts clearly believe Palo Alto Networks is more favorable than PayPal Holdings.
This table compares Palo Alto Networks and PayPal Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Palo Alto Networks||-12.57%||-19.72%||-4.89%|
Earnings & Valuation
This table compares Palo Alto Networks and PayPal Holdings’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Palo Alto Networks||$1.76 billion||7.68||-$99.10 million||($2.45)||-60.08|
|PayPal Holdings||$11.76 billion||7.42||$2.26 billion||$1.29||56.25|
PayPal Holdings has higher revenue and earnings than Palo Alto Networks. Palo Alto Networks is trading at a lower price-to-earnings ratio than PayPal Holdings, indicating that it is currently the more affordable of the two stocks.
PayPal Holdings beats Palo Alto Networks on 11 of the 14 factors compared between the two stocks.
About Palo Alto Networks
Palo Alto Networks, Inc. offers a next-generation security platform. The Company’s security platform consists of three elements: Next-Generation Firewall, Advanced Endpoint Protection and Threat Intelligence Cloud. Its Next-Generation Firewall delivers application, user and content visibility and control, as well as protection against network-based cyber threats integrated within the firewall through its hardware and software architecture. Its Advanced Endpoint Protection prevents cyber attacks that run malicious code or exploit software vulnerabilities on a range of fixed and virtual endpoints and servers. Its Threat Intelligence Cloud provides central intelligence capabilities, security for software as a service applications and automated delivery of preventative measures against cyber attacks. Its products and services include firewall appliances, panorama, virtual system upgrades, subscription services, support and maintenance, and professional services.
About PayPal Holdings
PayPal Holdings, Inc. is a technology platform and digital payments company that enables digital and mobile payments on behalf of consumers and merchants. The Company’s combined payment solutions, including its PayPal, PayPal Credit, Braintree, Venmo, Xoom and Paydiant products, compose its Payments Platform. It operates a two-sided global technology platform that links its customers, both merchants and consumers, around the globe to facilitate the processing of payment transactions, allowing it to connect merchants and consumers. It allows its customers to use their account for both purchase and paying for goods, as well as to transfer and withdraw funds. It enables consumers to exchange funds with merchants using funding sources, which include bank account, PayPal account balance, PayPal Credit account, credit and debit card or other stored value products. It offers consumers person-to-person payment solutions through its PayPal Website and mobile application, Venmo and Xoom.
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