Palo Alto Networks stock rockets more than 10% as cybersecurity company hikes annual guidance a third time

Palo Alto Networks boosted its full-year outlook for a third quarter in a row, forecasting adjusted earnings of $7.43 to $7.46 a share, revenue of $5.48 billion to $5.5 billion, and billings of $7.11 billion to $7.14 billion. Last quarter, the company had hiked its outlook to adjusted earnings of $7.23 to $7.30 a share, versus a previous forecast of $7.15 to $7.25 a share, and raised forecasts for revenue and billings once again.

Analysts expect $7.29 a share on revenue of $5.46 billion and billings of $6.82 billion.

Accordingly, Palo Alto Networks said it expects adjusted fiscal-fourth quarter earnings of $2.26 to $2.29 a share on revenue of $1.53 billion to $1.55 billion and billings of $2.32 billion to $2.35 billion, while analysts surveyed by FactSet had forecast $2.22 a share on revenue of $1.53 billion and billings of $2.23 billion.

Shares soared more than 10% after hours, following a 0.5% decline in the regular session to close at $436.37.

For the fiscal third quarter, Palo Alto Networks reported a loss of $73.2 million, or 74 cents a share, compared with a loss of $145.1 million, or $1.50 a share, in the year-ago period. Adjusted earnings, which exclude share-based compensation charges and other items, were $1.79 a share, compared with $1.38 a share in the year-ago period.

Revenue rose to $1.39 billion from $1.07 billion in the year-ago quarter. Billings, which reflects future business under contract, rose to $1.8 billion, compared with $1.27 billion a year ago.

Analysts had forecast earnings of $1.68 a share on revenue of $1.36 billion and billings of $1.6 billion, while Palo Alto Networks had forecast earnings of $1.65 to $1.68 a share on revenue of $1.35 billion to $1.37 billion and billings of $1.59 billion to $1.61 billion.

Palo Alto Networks has gone more than well over a year without announcing a new acquisition, following a four-year M&A spree, having acquired a dozen companies — the largest being attack-surface management company Expanse Inc. and security orchestration, automation and response company Demisto Inc. — for a total cost of about $3.3 billion. In August, the company said it wasn’t looking for any more acquisitions, a stance that Arora reiterated last quarter.

Palo Alto Networks shares are up 30% over the past 12 months. In comparison, the ETFMG Prime Cyber Security ETF  HACK, +0.31%  is down 19%, the S&P 500 index  SPX, -0.58%  is off 5%, and the tech-heavy Nasdaq Composite Index  COMP, -0.26%  is down 14%.

Back in December, Palo Alto Networks joined the Nasdaq 100 Index  NDX, -0.44%,  which is down more than 10% over the past 12 months.