Palo Alto Networks, Inc. (NASDAQ:PANW) Given Consensus Recommendation of "Moderate Buy" by Analysts

Key Points

• Analysts remain broadly bullish: 39 of 50 brokerages rate Palo Alto Networks a “buy,” versus 11 holds, producing a “Moderate Buy” consensus and an average 12-month price target of about $387.60.
• Operating results showed strong growth: quarterly revenue rose 34.5% year over year to $3.41 billion, while EPS of $1.02 exceeded the $0.98 consensus estimate.
• Valuation and profitability remain concerns: PANW trades at a very elevated P/E ratio, and the company reported a $282 million GAAP net loss; insiders have also sold shares in recent months.

Palo Alto Networks, Inc. (NASDAQ:PANW - Get Free Report) has earned a consensus recommendation of "Moderate Buy" from the fifty brokerages that are currently covering the stock, MarketBeat.com reports. Eleven investment analysts have rated the stock with a hold rating and thirty-nine have issued a buy rating on the company. The average 1-year price objective among brokerages that have issued a report on the stock in the last year is $387.5957.

PANW has been the topic of several recent research reports. Sanford C. Bernstein restated an "outperform" rating and issued a $253.00 price objective on shares of Palo Alto Networks in a research report on Wednesday, September 2nd. Roth Capital reiterated a "neutral" rating and set a $300.00 price objective (up from $210.00) on shares of Palo Alto Networks in a research report on Wednesday, September 2nd. Citizens Jmp boosted their target price on shares of Palo Alto Networks from $320.00 to $415.00 and gave the company a "market outperform" rating in a research note on Wednesday, August 12th. Royal Bank Of Canada upped their target price on shares of Palo Alto Networks from $434.00 to $475.00 and gave the company an "outperform" rating in a report on Wednesday, September 2nd. Finally, JPMorgan Chase & Co. raised their price target on shares of Palo Alto Networks from $326.00 to $384.00 and gave the stock an "overweight" rating in a research note on Tuesday, August 25th.

Palo Alto Networks Stock Down 2.3%

PANW stock opened at $330.65 on Friday. The company's 50 day simple moving average is $349.25 and its 200-day simple moving average is $261.06. The firm has a market capitalization of $269.48 billion, a PE ratio of 648.35, a P/E/G ratio of 9.83 and a beta of 0.91. Palo Alto Networks has a 12 month low of $139.57 and a 12 month high of $398.88. The company has a debt-to-equity ratio of 0.06, a current ratio of 0.87 and a quick ratio of 0.86.

Palo Alto Networks (NASDAQ:PANW - Get Free Report) last issued its quarterly earnings data on Tuesday, September 1st. The network technology company reported $1.02 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.98 by $0.04. Palo Alto Networks had a return on equity of 8.50% and a net margin of 2.67%.The firm had revenue of $3.41 billion during the quarter, compared to the consensus estimate of $3.35 billion. During the same period in the previous year, the firm posted $0.95 EPS. The company's quarterly revenue was up 34.5% compared to the same quarter last year. Palo Alto Networks has set its FY 2027 guidance at 4.160-4.190 EPS and its Q1 2027 guidance at 0.960-0.980 EPS. Equities analysts expect that Palo Alto Networks will post 2.29 earnings per share for the current fiscal year.

Palo Alto Networks News Summary

Here are the key news stories impacting Palo Alto Networks this week:

• Positive Sentiment: CEO Nikesh Arora said artificial intelligence is creating an estimated $1 trillion cybersecurity modernization opportunity, because legacy systems are not designed to defend against machine-speed attacks. The comments support the long-term demand outlook for Palo Alto Networks’ security platform. Palo Alto CEO discusses the AI security gap
• Positive Sentiment: Wedbush initiated coverage with an “outperform” rating and a $400 price target, implying approximately 21% upside from the referenced trading level. The call reflects confidence in PANW’s platform expansion and cybersecurity growth prospects.
• Positive Sentiment: Recent quarterly results showed revenue of $3.41 billion, up 34% year over year, while Next-Generation Security annual recurring revenue climbed 63% to $9.10 billion. Remaining performance obligations also increased 34% to $21.2 billion, indicating substantial contracted demand. Palo Alto Networks reports NGS ARR growth
• Neutral Sentiment: The Goldman Sachs Communacopia presentation provided additional management commentary, but no new material financial guidance or catalyst was identified in the supplied information. Palo Alto Networks conference transcript
• Negative Sentiment: Investors remain concerned that the quarter included a $282 million GAAP net loss, with acquisition costs potentially limiting near-term earnings conversion despite strong ARR growth. The stock also trades at a very elevated earnings multiple, increasing sensitivity to execution and profitability concerns. Why Palo Alto Networks shares are trading lower

Insider Activity

In other Palo Alto Networks news, Director Aparna Bawa sold 632 shares of the stock in a transaction on Monday, June 29th. The stock was sold at an average price of $318.67, for a total transaction of $201,399.44. Following the transaction, the director owned 6,727 shares of the company's stock, valued at $2,143,693.09. This represents a 8.59% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through this link. Also, CAO Josh D. Paul sold 900 shares of the firm's stock in a transaction on Wednesday, July 1st. The stock was sold at an average price of $345.00, for a total value of $310,500.00. Following the sale, the chief accounting officer owned 79,644 shares in the company, valued at $27,477,180. This trade represents a 1.12% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Over the last ninety days, insiders sold 9,667 shares of company stock worth $3,058,443. 1.40% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Palo Alto Networks

Several large investors have recently added to or reduced their stakes in PANW. Darwin Wealth Management LLC acquired a new stake in shares of Palo Alto Networks in the second quarter worth approximately $25,000. Solstein Capital LLC acquired a new position in Palo Alto Networks during the second quarter worth approximately $26,000. Sittner & Nelson LLC raised its stake in Palo Alto Networks by 73.8% during the fourth quarter. Sittner & Nelson LLC now owns 146 shares of the network technology company's stock worth $27,000 after purchasing an additional 62 shares during the period. N.E.W. Advisory Services LLC purchased a new position in Palo Alto Networks during the second quarter worth approximately $27,000. Finally, WHI TRUST Co LLC acquired a new position in shares of Palo Alto Networks in the 4th quarter valued at $28,000. 79.82% of the stock is currently owned by hedge funds and other institutional investors.

Palo Alto Networks Company Profile

Palo Alto Networks, Inc is a cybersecurity company that provides security products and services to businesses, governments and other organizations worldwide. The company helps customers protect networks, cloud environments, endpoints, applications and connected devices from cyber threats.

Its portfolio includes next-generation firewalls and network security technologies, as well as cloud-delivered security solutions such as Prisma Access and Prisma Cloud. Palo Alto Networks also offers Cortex products for endpoint protection, security operations, threat detection and response, and automation.

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