Palo Alto Networks, Inc. (PANW) has outperformed the S&P 500, rising by approximately 25% compared to the S&P 500’s decline of roughly 10% over the past year. Hedge funds were buying in the first quarter of 2022 as demand for cybersecurity solutions remained strong, and the cybersecurity leader saw continued market growth. As a result, it was added to the WhaleWisdom WhaleIndex 100 on May 17, 2022.

Palo Alto Networks provides cybersecurity solutions worldwide through products and services such as firewalls, intrusion prevention and detection systems, mobile device protection, uniform resource locator filtering, and cybersecurity consulting. Palo Alto Networks brings in revenue through selling its software applications and subscriptions for the ongoing support of next-generation security (NGS) services. The company operates three distinct yet complementing ecosystems: Strata, Prisma, and Cortex. Strata is its core network security platform, Prisma is its suite of cloud-based security services, and Cortex is its artificial intelligence-powered threat detection platform.

(WhaleWisdom)

Hedge Funds Add to Holdings

Hedge funds and institutions were buying Palo Alto Networks’ stock in the first quarter of 2022. The aggregate 13F shares held by hedge funds increased to about 21.1 million from 21.0 million, an increase of approximately 1.6%. Of the hedge funds, 56 created new positions, 85 added, 39 exited, and 93 reduced their holdings. Institutions increased their aggregate holdings by about 2.9% to approximately 85.5 million from 83.1 million. The 13F metrics from 2014 through June 2022 show that funds and stock prices continue to move on an upward trend.

(WhaleWisdom)

Favorable Multi-year Estimates

Analysts expect to see positive revenue and earnings trend continue into 2023. The estimated growth rates could bring revenue to over $6.7 billion by July 2023. Earnings per share are expected to rise to $7.45 by July 2022 and $9.28 by July 2023.

(WhaleWisdom)

Analysts Adjust Price Targets

While not all analysts raised price targets following quarterly results, many view Palo Alto Networks’ stock as a worthy investment. Analyst Patrick Colville of Deutsche Bank raised the price target on Palo Alto Networks to $605 from $587 and kept a Buy rating on shares. Wedbush Securities analyst, Daniel Ives, lowered the firm’s price target on the cybersecurity stock to $580 from $660 and reiterated an Outperform rating on shares. Analyst Gregg Moskowitz of Mizuho Financial Group held a Buy rating on shares with a price target of $600. Mizuho shared enthusiasm over Palo Alto Networks’ impressive billings and product revenue, noting that the company has a robust collection of cloud assets.

Positive Outlook

Palo Alto Networks continues to weather market volatility, and the cybersecurity company is showing promise in 2022. Hedge funds and institutions were buying, and revenue estimates through 2023 look favorable. There continues to be solid demand for cybersecurity and cloud services, and the company’s long-term performance makes it an attractive opportunity for investors.

CrowdStrike Holdings, Inc. (CRWD) saw its stock rebound slightly in June, after almost six months of disappointing performance during a volatile market. CrowdStrike continues to underperform the S&P 500, declining by approximately 25%, while the S&P has been flat over the past year. Despite the fluctuations, hedge funds were actively buying the stock in the first quarter, though the stock slid on the WhaleWisdom Heatmap to thirteen from nine.

CrowdStrike is a cybersecurity technology company that provides customers with cloud-based workload and endpoint security. CrowdStrike leverages modern technologies such as artificial intelligence (AI) and cloud computing and provides services such as threat intelligence and cyberattack response.

(WhaleWisdom)

Hedge Funds Are Buying

Despite CrowdStrike’s slowdown in performance, hedge funds were very bullish on the stock during the first quarter. Hedge funds increased their holdings, and the aggregate 13F shares rose to approximately 50.2 million from about 48.7 million, an increase of roughly 3.1%. Overall, 49 hedge funds created new positions, 99 added to an existing holding, 45 exited, and 70 reduced their stakes. Institutions also added shares to their portfolios, increasing aggregate holdings by about 5.1% to approximately 153.0 million from 145.6 million. The 13F metrics between 2019 and 2022 show that funds remained reasonably steady despite CrowdStrike’s fluctuating stock price.

(WhaleWisdom)

Encouraging Multi-year Estimates

Analysts predict earnings per share will rise in the coming years, increasing to $1.76 by January 2024, up from an expected $1.20 for January 2023. Robust performance is anticipated to bring revenue to roughly $3.0 billion by early 2024, up from an estimated $2.2 billion in 2023.

(WhaleWisdom)

Analysts Share a Range of Price Targets

Analysts are far from consensus about the stock, with some raising price targets as others lower them. Morgan Stanley analyst Hamza Fodderwala raised the firm’s price target on CrowdStrike to $195 from $181 while maintaining an Equal Weight rating on shares. Fodderwala noted a strong technology spending environment and favorable revenue guidance for the second quarter. Analyst Joseph Gallo of Jefferies & Company, Inc. raised his firm’s price target on the cybersecurity stock to $215 from $200, citing impressive annual recurring revenue growth. Gallo kept a Buy rating on CrowdStrike’s shares. Analyst Rudy Kessinger of D.A. Davidson & Co. took a different view and lowered the firm’s price target on CrowdStrike to $235 from $280. Davidson adjusted the price target based upon consideration of peer competitors but also kept a Buy rating on shares. Oppenheimer & Co. analyst Ittai Kidron maintained an Outperform rating on shares, factoring in the potential for macroeconomic headwinds. Kidron lowered the firm’s price target to $250 from $300 but noted that the technology company has the opportunity for growth.

Positive Outlook Beyond 2022

While CrowdStrike’s growth has slowed, hedge funds are still buying shares, and earnings estimates through 2024 are encouraging. Demand for the company’s cybersecurity-themed services should continue to gain strength, and the technology stock appears to be an attractive opportunity for long-term investors.

Palo Alto Networks, Inc. (PANW) continues to weather market volatility in 2022. Hedge funds were buying as the company outperformed the S&P 500. Palo Alto Network’s stock rose by over 30%, compared to the S&P 500, which has been unchanged over the past year. The cybersecurity leader was added to the WhaleWisdom Whale Index on May 17, 2022.

Palo Alto Networks is a global cybersecurity company that offers network security functions, including firewalls, threat protection, and intrusion prevention and detection. The company’s products and services have garnered a higher demand over the past four years, supporting increased cloud-based computing and remote work across industries. Palo Alto Networks utilizes its cybersecurity ecosystems to serve customers worldwide by protecting their data and reducing security complexities. The company’s three primary segments are Strata, Prisma, and Cortex. Strata is a network security platform that generates the bulk of the company’s revenue, with Prisma and Cortex representing its next-generation security (NGS) services.

(WhaleWisdom)

Hedge Funds Buy

Palo Alto Networks saw hedge funds actively buying in the first quarter of 2022. The aggregate shares held by hedge funds increased to about 21.1 million from 20.8 million, approximately 1.6%. Of the hedge funds, 56 created new positions, 85 added to an existing one, 39 exited, and 93 reduced their holdings. Institutions also bought the stock and increased their aggregate holdings by about 2.9%, to approximately 85.5 million from 83.1 million. Also, the 13F metrics between 2014 and 2022 suggest that Palo Alto continues to have investment potential as it follows an upward trend.

(WhaleWisdom)

Encouraging Multi-year Estimates

Analysts expect to see earnings rise through 2023, with anticipated growth that could bring earnings to $7.45 by July 2022 and $9.29 by July 2023. Year-over-year estimates forecast approximately $6.7 billion in revenue by the summer of 2023, up from $5.5 billion for 2022.

(WhaleWisdom)

Favorable Analyst Feedback

Palo Alto Network’s stock has garnered interest and commentary from analysts. Patrick Colville of Deutsche Bank raised his firm’s price target on Palo Alto to $605 from $587 and kept a Buy rating on shares following solid third-quarter results that beat analysts’ estimates. Wedbush Securities analyst Dan Ives shared that Palo Alto’s cloud-driven strategy resonates well with cybersecurity customers. At the same time, Ives lowered the firm’s price target on the stock to $580 from $660 and kept an Outperform rating on shares. Morgan Stanley analyst Hamza Fodderwala noted the stock’s impressive billings growth and optimism that Palo Alto Network could continue its forward momentum and potentially double its market price within two years. Fodderwala shared an $823 price target on shares and an Overweight rating. Deutsche Bank analyst Patrick Colville kept a Buy rating on Palo Alto Network shares and raised the firm’s price target on the stock to $605 from $587.

Bright Outlook

Palo Alto Networks continues to outpace the S&P, despite overall market volatility. The cybersecurity leader’s multi-year earnings estimates speak to the stock’s potential. Factoring the company’s track record and analysts’ outlooks, Palo Alto Networks presents an attractive opportunity for investors.

Shopify, Inc. (SHOP) faced market volatility and a sharp decline in value over the past five months. The stock underperformed the S&P 500, declining by roughly 72.9% compared to the S&P 500’s loss of around 13.3% over the past year. Hedge funds have been actively selling Shopify’s shares, but the stock rose on the WhaleWisdom Heatmap to a rank of 14 from 22.

Shopify is a multinational e-commerce company that takes a platform business model approach to cloud-based commerce for small and medium-sized businesses. Shopify helps merchants connect with consumers by providing the software to establish their e-commerce website, manage inventory, process orders and payments, and monitor sales activity through Shopify’s analytical and reporting tools.

In May, Shopify announced that it would acquire Deliverr, Inc., an e-commerce fulfillment company that provides solutions to e-commerce marketplaces such as eBay, Etsy, Amazon, and Walmart online. The acquisition is valued at approximately $2.1 billion and will enable an end-to-end logistics platform that would reduce supply chain logistics for merchants and help Shopify’s Fulfillment Network (SFN) better manage merchant inventory. The acquisition can make the fulfillment process easier on merchants with shorter delivery time options for consumers.

Hedge Funds Sell

Shopify saw hedge funds selling in the first quarter of 2022, with the aggregate 13F shares held by hedge funds lowered to approximately 19.2 million from 21.0 million, a change of roughly 8.8%. Of the hedge funds, 49 were created, 87 were added, 81 closed, and 80 reduced their positions. Institutions sold and decreased their aggregate holdings by about 4.4% to approximately 75.2 million from 78.7 million.

(WhaleWisdom)

Positive Earnings Estimates

Analysts expect to see earnings modestly rise in 2022 and 2023, bringing earnings per share to $2.52 by December 2023, up from an estimated $1.03 for December 2022. Estimates are also optimistic for revenue, with an anticipated rise by the end of 2022 to approximately $5.8 billion. Momentum is expected to continue into 2023 and bring revenue of about 7.7 billion by December 2023.

Price Targets Cut Following Q1 Earnings Miss

Many analysts have cut price targets following Shopify’s disappointing first-quarter earnings report. Another development that garnered analysts’ attention was Shopify’s announced deal to acquire Deliverr. Shopify also plans to reinvest gross profits back into its business to pursue expansion to more merchants, grow product development, and strengthen its partner ecosystem. Analyst Ygal Arounian of Wedbush Securities responded to Q1 earnings by lowering the firm’s price target on Shopify to $538 from $630. Arounian maintained an Outperform rating on the stock. Mizuho dramatically cut the firm’s price target on Shopify to $400 from $800 and kept a Neutral rating. Robert W. Baird analysts lowered their price target to $630 from $1000, indicating potential upside for the stock. Citigroup analyst Tyler Radke also responded to an overall weakening e-commerce trend by lowering the firm’s price target on Shopify to $432 from $534.

Optimistic Outlook Beyond 2022

While Shopify’s growth has slowed, 2023 revenue and earnings estimates are encouraging. Many analysts lowered price targets in May, though indications are that the stock’s actual value is greater than the stock price. Shopify may be an opportunity suited best for patient investors.

Tesla, Inc. (TSLA) continues to face market volatility. Tesla rose by approximately 13.1% compared to the S&P 500’s loss of 6.2% over the past year. In the first quarter of 2022, the company rose on the WhaleWisdom HeatMap to a rank of two from thirty-six.

Tesla is an automotive and clean energy-focused company with a business model primarily focused on developing, manufacturing, and selling electric vehicles (EV) and EV charging stations. In 2015, the business expanded from EV to design and to manufacture energy storage systems for homes and businesses through its Tesla Energy subsidiary. The company’s mission is to accelerate the world’s transition to sustainable energy. The market for Tesla’s EVs continues to grow, and interest in the company’s clean energy products such as solar panels and solar roof tiles.

Tesla’s growth has fluctuated over the past six months, impacted by economic and political factors and outside investment decisions by Elon Musk, a primary founder and a principal shareholder of the company. Musk is also in the process of buying communications company Twitter, Inc., an influential social networking service, and taking it private. The pending Twitter acquisition has caused concerns among U.S. politicians about the impact on social media and elections, and some investors worry that the purchase could distract Musk from running Tesla. However, while Musk is the CEO, Tesla maintains a solid executive team to oversee operations.

Hedge Funds Tweak Portfolios

Hedge Funds adjusted their portfolios, and the aggregate 13F shares held decreased slightly to approximately 58.31 million from 58.32 million, a slide of about 0.01%. Overall, 35 hedge funds created new positions, 194 added, 44 exited, and 129 reduced their stakes. Institutions were buying and increased their holdings by about 0.7% to $435.2 million.

(WhaleWisdom)

Encouraging Multiyear Figures

Analysts expect to see earnings rise over the next two years, with growth estimated to bring earnings per share to $12.48 by December 2022 and $15.82 by December 2023. Year-over-year estimated increases could also bring revenue close to $115.3 billion by 2023, up from a potential $86.7 billion in 2022.

Analysts Weigh-in Amid Shanghai Lockdowns

Tesla has faced delays in production in Shanghai due to parts shortages and recent Coronavirus-related restrictions in China. Additionally, Tesla recalled approximately 107,000 cars manufactured in China due to potential safety risks. Analyst Dan Ives of Wedbush Securities lowered the firm’s price target on Tesla to $1,000 from $1,400 while maintaining an Outperform rating. Ives shared that the Shanghai lockdowns were a disrupter for Tesla’s second quarter, and the company may expect a slower growth trajectory for deliveries in China. While Wedbush Securities remains bullish on Tesla over the long-term, Ives shared that both production challenges in China and the negative feedback from Musk’s Twitter bid have negatively impacted Tesla’s stock at this time.

Positive Outlook Beyond 2022

Tesla’s stock may have lost some ground, but the electric vehicle manufacturer and clean energy company has also shown continued business growth. Hedge funds were overall selling, but earnings and revenue estimates through 2023 look favorable. Tesla’s dip in share value may be appealing to new investors, and the company appears in a good position to meet and capitalize on rising customer demand for electric vehicles and clean energy solutions.