Palo Alto Networks: A Top Edge Computing Stock to Invest in

Palo Alto Networks (PANW) has emerged as a leading player in the edge computing sector, capturing the attention of analysts and investors alike. With its robust Secure Access Service Edge (SASE) platform, Prisma Access, and advanced virtual firewalls, PANW offers a comprehensive suite of security solutions tailored for edge computing environments. This article explores why PANW is among the best edge computing stocks to invest in, according to analysts.

Palo Alto Networks' Prisma Access platform stands out in the market, integrating Firewall as a Service (FWaaS), threat prevention, DNS security, and data loss prevention (DLP). This all-in-one solution provides advanced edge resource protection, making it a top choice for businesses seeking to secure their edge computing infrastructure. According to Gartner, Prisma Access is one of the top SASE solutions, praised for its strong security capabilities and ease of use.



Palo Alto Networks' VM-Series and CN-Series virtual firewalls are another key attraction for edge computing investments. These firewalls offer inline network security on multi- and hybrid-cloud environments, providing advanced threat prevention, URL filtering, and malware and persistent threat protection. Their ease of deployment and management, along with seamless integration with PANW's broader security ecosystem, make them an attractive choice for edge computing environments.



Palo Alto Networks' Cortex platform for security operations is yet another reason why PANW is a top edge computing stock. This AI-driven security orchestration, automation, and response (SOAR) platform offers a comprehensive suite of integrated security tools, enabling organizations to tailor their security operations to their specific needs. Cortex's customizability and adaptability set it apart from other SOAR platforms, making it a strong choice for businesses seeking to optimize their security operations.

Analysts have taken notice of Palo Alto Networks' strong financial performance and growth potential. PANW's revenue growth and earnings per share (EPS) have consistently outperformed industry peers and market benchmarks. From 2023 to 2024, PANW's revenue grew by 14% year-over-year, while its EPS increased by 13%. The company's Next-Generation Security Annual Recurring Revenue (ARR) grew by an impressive 40% to $4.5 billion, further demonstrating its strong financial performance.



Key drivers behind Palo Alto Networks' financial performance include its strong revenue growth, particularly in its subscription and support segment, and its commitment to research and development. However, PANW's dependence on subscription and support revenue and the potential for disruptions in renewals pose a risk to its financial stability.

Analysts' price targets and earnings estimates for Palo Alto Networks have evolved over time, reflecting the company's growth and strategic initiatives. As of December 17, 2024, the average upside potential for PANW is 12.48%, with 49 analysts covering the stock. The number of hedge funds holding stakes in PANW has increased to 64, indicating growing institutional interest.

In conclusion, Palo Alto Networks' robust security solutions, strong financial performance, and growing analyst interest make it a top edge computing stock to invest in. As the edge computing sector continues to grow, PANW's comprehensive suite of security offerings and commitment to innovation position it well to capitalize on this trend. Investors seeking exposure to the edge computing sector should consider Palo Alto Networks as a strong contender in their portfolio.