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3 Reasons Palo Alto Networks Is Becoming a Wall Street Favorite 
Up more than 10% year-to-date (YTD) and about 20% in the past 12 months, cybersecurity firm Palo Alto Networks (NASDAQ: PANW) has weathered the initial storm of tariff uncertainty well. In a sign of support for PANW, institutional investors have taken a particular interest in the firm in recent months. In the first quarter alone, for example, HighPoint Advisor Group bulked up its stake by 20%, Crestwood Advisors Group by 18%, and J.W. Cole Advisors by 81%, among others. In the last 12 months, institutional buyers of Palo Alto shares have outnumbered institutional sellers nearly three to one, while institutional inflows have outpaced outflows by a similar margin. Institutional ownership for the company is roughly 80%. Though it's not always possible to confirm what draws institutional investors to a particular stock, a few likely catalysts include Palo Alto's excellent fundamentals and recent performance, its strong next-gen security products, and the company's shift toward artificial intelligence (AI) platformization. The End of Elon Musk? Don't make him laugh.
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According to his research, if you listen to the media and miss out on Elon's newest breakthrough, it's going to cost you the fortune of a lifetime. Click here to see why the "End of Elon" crowd is about to be wrong again. 1. Top- and Bottom-Line Performance, Margins, and Forecasts Strong Palo Alto Networks' latest earnings report was solid across the board and affirmed its stable financial standing. The company posted double-digit revenue growth of more than 15% year-over-year (YOY) to about $2.3 billion, ahead of analyst predictions. Earnings per share (EPS) of 80 cents also beat expectations. The company's margins are also improving—its non-GAAP operating margin for the quarter was 27.4%, close to two full percentage points higher than 25.6% in the prior-year quarter. What's more, Palo Alto expects these trends to continue, with fiscal 2025 operating margin anticipated in the range of 28.2% to 28.5%. With growing revenue and earnings and improving efficiency, Palo Alto is well prepared for future growth. Further, the company's strong cash position provides an extra level of security should unexpected geopolitical uncertainty enter into the picture as well. Externally, analysts believe Palo Alto is positioned to continue to build on recent gains as well. Analysts expect the firm to grow its earnings by a sizable 19.3% in the coming year. 2. Next-Gen Security Products Take the Lead Behind Palo Alto's YOY gains in the latest quarter are its next-generation security tools, Prisma and Cortex. Prisma is a cloud-based security solution while Cortex utilizes AI and machine learning. Thanks to Palo Alto's subscription-based service model, its next-gen security tools have experienced rapid annual recurring revenue (ARR) growth. Indeed, for the latest quarter, these products had an increase of 34% YOY to ARR, reaching $5.1 billion. Palo Alto Networks expects this growth rate to roughly maintain into the next quarterly report and for the full fiscal year as well, as it has forecast next-gen security ARR growth of 31% to 32% for both of those periods. Bitcoin is breaking out — and one state just created a Strategic Crypto Reserve.
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