Palo Alto Networks Inc (PANW)

Return on equity (ROE)

		Jul 31, 2024	Apr 30, 2024	Jan 31, 2024	Oct 31, 2023	Jul 31, 2023	Apr 30, 2023	Jan 31, 2023	Oct 31, 2022	Jul 31, 2022	Apr 30, 2022	Jan 31, 2022	Oct 31, 2021	Jul 31, 2021	Apr 30, 2021	Jan 31, 2021	Oct 31, 2020	Jul 31, 2020	Apr 30, 2020	Jan 31, 2020	Oct 31, 2019
Net income (ttm)	US$ in thousands	2,577,600	2,447,600	2,276,600	613,900	439,700	215,300	34,300	-143,400	-267,000	-389,600	-461,500	-510,300	-498,900	-438,500	-368,200	-299,600	-267,000	-228,900	-174,300	-103,200
Total stockholders’ equity	US$ in thousands	5,169,700	4,467,800	4,357,200	2,170,500	1,748,400	1,232,400	729,000	508,000	210,000	337,600	117,800	518,900	634,500	997,200	1,037,300	747,000	1,101,800	744,700	1,608,500	1,516,400
ROE		49.86%	54.78%	52.25%	28.28%	25.15%	17.47%	4.71%	-28.23%	-127.14%	-115.40%	-391.77%	-98.34%	-78.63%	-43.97%	-35.50%	-40.11%	-24.23%	-30.74%	-10.84%	-6.81%

July 31, 2024 calculation

ROE = Net income (ttm) ÷ Total stockholders’ equity
= $2,577,600K ÷ $5,169,700K
= 49.86%

Palo Alto Networks Inc's return on equity (ROE) has shown significant fluctuations over the past few years. There was a substantial improvement in ROE from Jul 2020 to Jul 2024, reaching a peak of 54.78% in Apr 2024. This indicates that the company was effectively generating profits from shareholders' equity during this period.

However, prior to that, the ROE had been volatile and even negative, with alarming figures such as -127.14% in Oct 2022 and -391.77% in Jan 2022. These negative ROE values suggest that the company was not efficiently utilizing shareholders' equity to generate profits and may have been incurring losses during those periods.

Overall, the recent positive trend in ROE is a positive sign for the company as it indicates improved profitability and better returns for shareholders. It will be important for Palo Alto Networks Inc to sustain and potentially improve its ROE performance to ensure long-term financial health and shareholder value.