Legal Alpha
Long/short equity, special situations, momentum, contrarian

Short Palo Alto Networks, Downside Risk Based On Upcoming Patent Infringement Trial

Summary

On Feb 24, Juniper Networks (NYSE:JNPR) and Palo Alto Networks (NYSE:PANW) start a patent infringement trial, where Juniper is suing Palo Alto for infringement of seven patents. The suit implicates virtually all of Palo Alto's firewall technology products. Juniper is seeking treble damages and a permanent injunction, barring Palo Alto from selling the infringing technology.

This case presents a serious risk to Palo Alto. If Palo Alto loses this case, its stock could drop substantially on the negative headline - possibly 15%. If the court issues an injunction barring Palo Alto from selling its technology, the stock could drop sharply below significant resistance levels and key moving averages - perhaps more than 25% - as...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
FREESA PRO MEMBERS
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details