Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
Palo Alto Networks Inc., FCFE calculation
US$ in thousands
Based on: 10-K (reporting date: 2024-07-31), 10-K (reporting date: 2023-07-31), 10-K (reporting date: 2022-07-31), 10-K (reporting date: 2021-07-31), 10-K (reporting date: 2020-07-31), 10-K (reporting date: 2019-07-31).
- Net Cash Provided by Operating Activities
- The net cash provided by operating activities exhibited a consistent upward trend over the observed period. Starting at approximately $1.06 billion in 2019, it slightly decreased to about $1.04 billion in 2020. From 2020 onwards, there was a substantial increase each consecutive year, reaching around $1.5 billion in 2021, $1.98 billion in 2022, $2.78 billion in 2023, and peaking at $3.26 billion in 2024. This suggests growing operational efficiency and stronger core business cash generation over time.
- Free Cash Flow to Equity (FCFE)
- Free cash flow to equity displayed more volatility throughout the period. It began at $443 million in 2019 before experiencing a sharp increase to $2.8 billion in 2020. This was followed by a decline to $1.39 billion in 2021, but then FCFE rose again to $1.79 billion in 2022. However, in 2023, FCFE decreased to $939 million before recovering to $2.07 billion in 2024. Despite fluctuations, the overall trend indicates the company’s capacity to generate significant discretionary cash flow returns to equity holders, with variability possibly linked to investments, financing activities, or changes in working capital.
Price to FCFE Ratio, Current
Palo Alto Networks Inc., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 666,800,000 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in thousands) | 2,067,100) |
| FCFE per share | 3.10 |
| Current share price (P) | 192.25 |
| Valuation Ratio | |
| P/FCFE | 62.02 |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| Accenture PLC | 18.22 |
| Adobe Inc. | 15.65 |
| Cadence Design Systems Inc. | 29.53 |
| CrowdStrike Holdings Inc. | 110.46 |
| Fair Isaac Corp. | 38.60 |
| International Business Machines Corp. | 22.97 |
| Intuit Inc. | 45.78 |
| Microsoft Corp. | 50.36 |
| Oracle Corp. | 126.87 |
| Palantir Technologies Inc. | 307.24 |
| Salesforce Inc. | 22.74 |
| ServiceNow Inc. | 58.69 |
| Synopsys Inc. | 73.04 |
| Workday Inc. | 27.43 |
| P/FCFE, Sector | |
| Software & Services | 46.55 |
| P/FCFE, Industry | |
| Information Technology | 46.92 |
Based on: 10-K (reporting date: 2024-07-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Palo Alto Networks Inc., historical P/FCFE calculation, comparison to benchmarks
| Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | Jul 31, 2020 | Jul 31, 2019 | ||
|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 651,200,000 | 617,189,208 | 598,427,616 | 584,436,678 | 578,239,764 | 581,942,880 | |
| Selected Financial Data (US$) | |||||||
| Free cash flow to equity (FCFE) (in thousands)2 | 2,067,100) | 939,200) | 1,791,300) | 1,385,900) | 2,800,400) | 443,300) | |
| FCFE per share3 | 3.17 | 1.52 | 2.99 | 2.37 | 4.84 | 0.76 | |
| Share price1, 4 | 167.91 | 121.36 | 88.43 | 78.04 | 39.28 | 35.20 | |
| Valuation Ratio | |||||||
| P/FCFE5 | 52.90 | 79.75 | 29.54 | 32.91 | 8.11 | 46.21 | |
| Benchmarks | |||||||
| P/FCFE, Competitors6 | |||||||
| Accenture PLC | 23.91 | 21.01 | 17.87 | 25.76 | 19.01 | 19.50 | |
| Adobe Inc. | 18.02 | 41.83 | 21.32 | 34.26 | 41.36 | 41.90 | |
| Cadence Design Systems Inc. | 24.08 | 71.40 | 33.41 | 36.31 | 45.86 | — | |
| CrowdStrike Holdings Inc. | 85.82 | 42.65 | 99.63 | 41.38 | 880.68 | — | |
| Fair Isaac Corp. | 53.56 | 49.48 | 10.12 | 12.69 | 38.46 | 32.51 | |
| International Business Machines Corp. | 20.90 | 9.97 | 11.97 | 48.45 | 9.43 | — | |
| Intuit Inc. | 38.43 | 38.74 | 13.86 | 86.74 | 17.36 | 34.61 | |
| Microsoft Corp. | 42.11 | 43.32 | 36.73 | 42.54 | 42.74 | 30.77 | |
| Oracle Corp. | 48.38 | 15.47 | — | 8.36 | 6.27 | — | |
| Palantir Technologies Inc. | 256.11 | 74.28 | 96.89 | 198.12 | — | — | |
| Salesforce Inc. | 38.33 | 31.06 | 16.56 | 49.52 | 50.40 | — | |
| ServiceNow Inc. | 61.82 | 58.19 | 44.44 | 64.54 | 49.83 | — | |
| Synopsys Inc. | 63.08 | 57.04 | 33.41 | 40.55 | 45.07 | 77.64 | |
| Workday Inc. | 36.59 | 19.79 | 49.17 | 40.57 | 74.21 | — | |
| P/FCFE, Sector | |||||||
| Software & Services | 39.97 | 32.86 | 30.85 | 33.71 | 26.75 | — | |
| P/FCFE, Industry | |||||||
| Information Technology | 36.66 | 33.16 | 26.84 | 27.24 | 23.37 | — | |
Based on: 10-K (reporting date: 2024-07-31), 10-K (reporting date: 2023-07-31), 10-K (reporting date: 2022-07-31), 10-K (reporting date: 2021-07-31), 10-K (reporting date: 2020-07-31), 10-K (reporting date: 2019-07-31).
1 Data adjusted for splits and stock dividends.
3 2024 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 2,067,100,000 ÷ 651,200,000 = 3.17
4 Closing price as at the filing date of Palo Alto Networks Inc. Annual Report.
5 2024 Calculation
P/FCFE = Share price ÷ FCFE per share
= 167.91 ÷ 3.17 = 52.90
6 Click competitor name to see calculations.
- Share Price
- The share price demonstrated a consistent upward trajectory over the analyzed period. Starting at $35.20 in 2019, the price modestly increased to $39.28 in 2020, followed by a significant jump to $78.04 in 2021. This growth trend continued steadily through 2022 and 2023, reaching $88.43 and $121.36 respectively, and peaked at $167.91 by 2024. This pattern suggests strong investor confidence or favorable market sentiment toward the company over these years.
- Free Cash Flow to Equity (FCFE) per Share
- The FCFE per share showed notable fluctuations. In 2019, the FCFE per share was relatively low at $0.76. There was a substantial increase in 2020 to $4.84, indicating a significant improvement in cash generated for equity holders. However, this was followed by a decline to $2.37 in 2021. Subsequent years saw some recovery, with values of $2.99 in 2022, a drop to $1.52 in 2023, and a rise again to $3.17 in 2024. These variations could reflect changes in operational cash flow or investment activities impacting free cash flow.
- Price to FCFE (P/FCFE) Ratio
- The P/FCFE ratio displayed considerable volatility, reflecting changes in the relationship between the market price and free cash flow per share. In 2019, the ratio was high at 46.21, then dropped sharply to 8.11 in 2020, corresponding with the spike in FCFE per share that year. It rose significantly to 32.91 in 2021 and slightly decreased to 29.54 in 2022. The ratio surged to 79.75 in 2023, indicating that the share price was high relative to FCFE per share, possibly pointing to stretched valuation. This ratio moderated somewhat to 52.9 in 2024, still reflecting a relatively high price level compared to cash flow. The fluctuations indicate varying investor expectations and perceived risk over time.