Shares of Palo Alto Networks (NYSE:PANW) climbed 14.6% in February, according to data from S&P Global Market Intelligence, after the cybersecurity platform company released strong fiscal second-quarter 2019 results.
To be sure, Palo Alto Networks stock popped nearly 10% on February 27, 2019, alone -- the first trading day after it announced its quarterly revenue had climbed 30.4% year over year, to $711.2 million, translating to adjusted net income of $147 million, or $1.51 per share (up from $1.05 per share in the same year-ago period). By comparison, the midpoints of Palo Alto Networks' guidance provided three months earlier called for earnings of $1.21 per share on revenue of $680 million.
Palo Alto Networks' revenue was driven by growth from both its product segment (up 32.6% to $271.6 million) and its subscription/support stream (up 29% to $439.6 million). Deferred revenue -- a key indicator of future sales growth -- also grew 26.6% to $852.5 million. Finally, Palo Alto Networks highlighted the decision of its board of directors the previous week to approve a new $1 billion share repurchase plan, valid through the end of next year.
If that wasn't enough, Palo Alto Networks sees revenue in the current third quarter of fiscal 2019 increasing 24% to a range of $697 million to $707 million -- compared to analysts' consensus models for sales near the low end of that range -- with adjusted earnings of $1.23 to $1.25 per share.
After coupling that solid outlook with Palo Alto Networks' relative outperformance in its fiscal second quarter -- and even with shares already up nearly 20% in January -- it was no surprise to see the stock continue to climb last month in response.