New underlying: Palo Alto Networks
We are now issuing Bull & Bear certificates and Mini Futures with Palo Alto as the underlying!
Background
Digital threats have become part of everyday life for businesses in our society. In January alone, the Finnish IT provider Tioetoevry suffered a ransomware attack, which had a major impact on its customers. Payroll systems for 120 Swedish authorities were down, and a large number of companies could no longer charge for their services. The attack is just one of many examples of when companies and authorities have been affected, and it is difficult to imagine the number of attacks decreasing. As a result, businesses are gearing up to deal with the threats of the digital age, much to the delight of cybersecurity companies.
One company that has benefited from this society-wide trend is Palo Alto (ticker: PANW), one of the world's largest companies operating in the cybersecurity sector. Palo Alto provides cybersecurity services and solutions to companies and governments around the world. The company is best known for its firewalls that protect systems from external threats, thereby making networks more secure. The company's services have seen a steady increase in demand as a result of the general concern and build-up in cybersecurity. Between Fiscal Year (FY) 2019 and FY 2023, the company has grown its turnover by 138.5 per cent according to data from Bloomberg, which corresponds to a Compounded Annual Growth Rate (CAGR) of 24.2 per cent during the period. At the same time, the company has managed to turn the result into profit. Looking at rolling 12 months Q2 2024, the company's net income is USD 807 million, which corresponds to a profit margin of 10.7 per cent.
Share price development
The favourable development for cyber security companies is not only reflected in the company's reported figures, but also in the share price. The share's trend is almost exponential over a five-year period. The price has gone from USD 81.8 on 1 March 2019 to USD 310.6 five years later. Clearly a nice development for shareholders, but the question is whether the trend can continue? Palo Alto recently released its Q2 report, where the company revised down its guidance for FY 2024, causing the stock to plummet over 28 per cent in one day.
We are pleased to offer Palo Alto in our range of underlyings. An important date to keep an eye on going forward is the 21st of May, which is the preliminary date for the company's Q3 report. You can find our products that follow Palo Alto HERE.
Risks
This information is neither an investment advice nor an investment or investment strategy recommendation, but advertisement. The complete information on the trading products (securities) mentioned herein, in particular the structure and risks associated with an investment, are described in the base prospectus, together with any supplements, as well as the final terms. The base prospectus and final terms constitute the solely binding sales documents for the securities and are available under the product links. It is recommended that potential investors read these documents before making any investment decision. The documents and the key information document are published on the website of the issuer, Vontobel Financial Products GmbH, Bockenheimer Landstrasse 24, 60323 Frankfurt am Main, Germany, on prospectus.vontobel.com and are available from the issuer free of charge. The approval of the prospectus should not be understood as an endorsement of the securities. The securities are products that are not simple and may be difficult to understand. This information includes or relates to figures of past performance. Past performance is not a reliable indicator of future performance.
Investors in the products are exposed to the risk that the Issuer or the Guarantor may not be able to meet its obligations under the products. A total loss of the invested capital is possible. The products are not subject to any deposit protection.
The value of the products can fall significantly below the purchase price due to changes in market factors, especially if the value of the underlying asset falls. The products are not capital-protected
Due to the leverage effect, there is an increased risk of loss (risk of total loss) with leverage products, e.g. Bull & Bear Certificates, Warrants and Mini Futures.
Product and possible financing costs reduce the value of the products.
If the product currency differs from the currency of the underlying asset, the value of a product will also depend on the exchange rate between the respective currencies. As a result, the value of a product can fluctuate significantly.