In his first "Executive Decision" segment of Tuesday's Mad Money program, Jim Cramer spoke with Nikesh Arora, chairman and CEO of cybersecurity company Palo Alto Networks (PANW) .
The company just finished their annual investor day.
Arora said that the acceleration of technology adoption continues to be a growth driver for Palo Alto and there's no going back to the old ways of doing business. Palo Alto invested heavily into their platforms when Arora first joined the company, he said, and now they're able to deploy great new products and technologies to their entire customer base.
One of those products is Okyo Garde, a new consumer-focused router with a number of uses. Arora explained that Okyo Garde is perfect for employees working from home, small businesses that don't have IT support and even basic consumers that just want added protection in their homes.
Arora noted that 75% of consumers don't even know their home router password, let alone check and manage their home network security. But everyone is now learning that there is an economic value to staying secure.
We looked at the charts of PANW on Monday and wrote that "If PANW pulls back to the $460 area aggressive traders could go long risking to $439. The round number of $500 is our first price target. $721 is our longer-term price objective."
Let's take another quick look at the charts to see if anything has changed.
In this updated daily bar chart of PANW, below, we can see that prices moved higher on Monday and Tuesday. The slope of the 50-day and 200-day moving averages remain positive.
The On-Balance-Volume (OBV) line made a new high for the move up as buyers of PANW remain more aggressive with heavier trading volume on days when PANW closes higher.
The Moving Average Convergence Divergence (MACD) oscillator is still bullish.
In this weekly Japanese candlestick chart of PANW, below, we can see that prices have pushed higher without seeing a significant upper shadow. A large upper shadow would suggest to us that traders were rejecting the highs. The absence of an upper shadow tells me that buyers are comfortable at these levels.
The 40-week moving average is still pointed up as is the OBV line and the MACD oscillator.
In this daily Point and Figure chart of PANW, below, we can see a new bullish upside price target of $765. Impressive.
Bottom line strategy: Continue to hold long positions as our $500 price target is near. Traders who are flat could probe the long side of PANW around $480 now risking to $465. The $765 area is our new price target.
