PANWNEUTRAL

Return on Equity (ROE)

4.8%

Updated 56h ago

Sector Performance

21th percentile

PANW

4.8%

Sector Median

13.8%

Sector Avg

31.4%

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Deep Analysis

Palo Alto Networks' Return on Equity (ROE) of 4.8% means that for every dollar of shareholder equity, the company generated about 4.8 cents in profit over the past year — a basic measure of how efficiently it uses investor capital.

This is well below the sector median of 13.9%, placing PANW in the 19th percentile among its peers, indicating weaker profitability relative to competitors. The year-over-year change is not available, but the quarter-over-quarter change shows a sharp decline of -66.9%, moving from 14.5% to the current 4.8%, with no trend direction established over the last eight quarters. The combination of a low ROE level and a steep quarterly drop suggests increased risk, as profitability has eroded quickly, though the limited historical data (only two values) makes the trend uncertain. This metric contradicts the overall NEUTRAL verdict because the ROE is both far below the sector median and deteriorating, pointing to potential weakness that a neutral stance does not fully capture.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about PANW?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

Who are PANW's closest peers by Return on Equity (ROE)?

The closest peers by Return on Equity (ROE) include: MRNA (-36.6%), FICO (-37.3%), XRAY (-37.7%), VRSN (-38.3%), MSCI (-45.3%).

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.