Contrasting The KEYW Holding Corporation (KEYW) & Palo Alto Networks (PANW)

The KEYW Holding Corporation (NASDAQ: KEYW) and Palo Alto Networks (NYSE:PANW) are both internet security & transactions services companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, institutional ownership, risk, valuation, analyst recommendations, dividends and earnings.

Insider and Institutional Ownership

95.1% of The KEYW Holding Corporation shares are owned by institutional investors. Comparatively, 77.5% of Palo Alto Networks shares are owned by institutional investors. 4.6% of The KEYW Holding Corporation shares are owned by insiders. Comparatively, 4.8% of Palo Alto Networks shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility and Risk

The KEYW Holding Corporation has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500. Comparatively, Palo Alto Networks has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for The KEYW Holding Corporation and Palo Alto Networks, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The KEYW Holding Corporation 0 2 4 0 2.67
Palo Alto Networks 1 11 29 0 2.68

The KEYW Holding Corporation currently has a consensus price target of $10.00, suggesting a potential upside of 80.18%. Palo Alto Networks has a consensus price target of $161.18, suggesting a potential upside of 12.94%. Given The KEYW Holding Corporation’s higher probable upside, analysts clearly believe The KEYW Holding Corporation is more favorable than Palo Alto Networks.

Profitability

This table compares The KEYW Holding Corporation and Palo Alto Networks’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The KEYW Holding Corporation -7.28% -2.29% -1.11%
Palo Alto Networks -12.57% -19.72% -4.89%

Earnings & Valuation

This table compares The KEYW Holding Corporation and Palo Alto Networks’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
The KEYW Holding Corporation $288.03 million 0.96 -$25.72 million ($0.58) -9.57
Palo Alto Networks $1.76 billion 7.45 -$216.60 million ($2.39) -59.72

The KEYW Holding Corporation has higher revenue, but lower earnings than Palo Alto Networks. Palo Alto Networks is trading at a lower price-to-earnings ratio than The KEYW Holding Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

The KEYW Holding Corporation beats Palo Alto Networks on 7 of the 13 factors compared between the two stocks.

About The KEYW Holding Corporation

The KeyW Holding Corporation is a holding company. The Company is a provider of engineering and technology solutions to support the collection, processing, analysis and dissemination of information across the full spectrum of the Intelligence, cyber and counterterrorism communities missions. It operates through Government Solutions segment. Its solutions are designed to meet the needs of agile intelligence and the United States government national security priorities through a range of cyber operations and training, geospatial intelligence, cloud and data analytics, engineering, and intelligence analysis and operations offerings. Its Intelligence Surveillance and Reconnaissance solution suite is deployed from a sensor delivery platform. It includes products, including electro-optical, hyperspectral and synthetic aperture radar sensors, and other products that it manufactures and integrates with hardware and software to meet evolving intelligence mission requirements.

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.

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