Palo Alto Networks (NYSE: PANW) and Mimecast Limited (NASDAQ:MIME) are both internet security & transactions services companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, valuation, institutional ownership, risk, profitability, earnings and analyst recommendations.
Risk and Volatility
Palo Alto Networks has a beta of 1.02, indicating that its share price is 2% more volatile than the S&P 500. Comparatively, Mimecast Limited has a beta of 0.65, indicating that its share price is 35% less volatile than the S&P 500.
Earnings and Valuation
This table compares Palo Alto Networks and Mimecast Limited’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Palo Alto Networks||$1.76 billion||7.64||-$216.60 million||($2.39)||-61.24|
|Mimecast Limited||$186.56 million||9.46||-$5.44 million||($0.13)||-238.92|
Mimecast Limited has higher revenue, but lower earnings than Palo Alto Networks. Mimecast Limited is trading at a lower price-to-earnings ratio than Palo Alto Networks, indicating that it is currently the more affordable of the two stocks.
This table compares Palo Alto Networks and Mimecast Limited’s 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%|
Institutional & Insider Ownership
76.9% of Palo Alto Networks shares are held by institutional investors. Comparatively, 52.8% of Mimecast Limited shares are held by institutional investors. 4.8% of Palo Alto Networks shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
This is a breakdown of recent recommendations for Palo Alto Networks and Mimecast Limited, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Palo Alto Networks||1||11||29||0||2.68|
Palo Alto Networks presently has a consensus target price of $161.18, indicating a potential upside of 10.13%. Mimecast Limited has a consensus target price of $31.08, indicating a potential upside of 0.08%. Given Palo Alto Networks’ higher possible upside, equities research analysts clearly believe Palo Alto Networks is more favorable than Mimecast Limited.
Mimecast Limited beats Palo Alto Networks on 7 of the 13 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 Mimecast Limited
Mimecast Limited is a provider of cloud security and risk management services for corporate information and e-mail. The Company’s suite of cloud services protects customers from the business and data security risks. It also mitigates the business disruption that e-mail failure or downtime causes. In addition, its archiving services secure, store and manage critical corporate communications and information to address the compliance and e-discovery requirements. It has developed its cloud architecture to offer customers e-mail security, continuity and archiving capabilities in a single service. It has developed an operating system (OS) called Mime OS for native cloud services. It protects inbound and outbound e-mail from malware, spam, threats, e-mail denial of service (DoS) and distributed denial of service (DDoS), data leaks and other security threats. It also offers service bundles, and Mimecast mobile and desktop applications.
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