Palo Alto (PANW) Investors Overly Concerned About Litigation, Thinks Goldman Sachs Analyst

November 13, 2013 11:05 AM EST
Get Alerts PANW Hot Sheet
Price: $142.11 +0.13%

Rating Summary:
    40 Buy, 10 Hold, 0 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 30 | Down: 30 | New: 23
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Goldman Sachs maintained a Buy rating on Palo Alto Networks (NYSE: PANW) with a price target of $75.00. Analyst Greg Dunham recommends buying the stock ahead of a hearing on November 15th regarding 6 patents held by Juniper Networks (NYSE: JNPR). Dunham wouldn't comment on the outcome of the hearing. However, he suggested investors expectations my be too severe.

"While there may be other reasons that PANW shares trade at a discount to peers, we note that in our conversations with investors, the most commonly cited cause for a possible overhang on PANW shares is the pending lawsuit with Juniper Networks," said Dunham.

"While we do not take a view on the final outcome of the lawsuit and recognize the ranges discussed are only indicative and the final outcomes could be outside of this, for illustrative purposes if we assume the financial impact of this case is on par with the average of the 10 largest cases we observed in the last 13+ years (~$1bn), we still see over $1bn of additional overhang priced into the shares," he concluded.

For an analyst ratings summary and ratings history on Palo Alto Networks click here. For more ratings news on Palo Alto Networks click here.

Shares of Palo Alto Networks closed at $41.28 yesterday.

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