Palo Alto Networks (NASDAQ:PANW) Shares Down 2.7% - Here's Why

Key Points

• Palo Alto Networks' stock fell 2.7% to a low of $206.70, with a trading volume 35% below its average, indicating reduced investor activity.
• Analysts maintain a buy rating for the stock, with an average price target of $216.00, supported by recent upgrades from firms like Bank of America and Tigress Financial.
• Insider selling has been significant, with executives selling over 1.3 million shares recently, leading to a notable decline in their ownership percentages.

Palo Alto Networks, Inc. (NASDAQ:PANW - Get Free Report)'s stock price dropped 2.7% during mid-day trading on Tuesday . The company traded as low as $206.70 and last traded at $207.56. Approximately 4,139,305 shares traded hands during trading, a decline of 35% from the average daily volume of 6,322,797 shares. The stock had previously closed at $213.28.

Analysts Set New Price Targets

Several equities analysts have recently issued reports on PANW shares. Tigress Financial began coverage on Palo Alto Networks in a research note on Friday, September 26th. They set a "buy" rating and a $245.00 target price on the stock. Truist Financial set a $220.00 price objective on shares of Palo Alto Networks and gave the company a "buy" rating in a research report on Tuesday, August 19th. Bank of America upgraded shares of Palo Alto Networks from a "neutral" rating to a "buy" rating and set a $215.00 price target on the stock in a research report on Tuesday, August 19th. Needham & Company LLC reiterated a "buy" rating and set a $230.00 price target on shares of Palo Alto Networks in a research report on Wednesday, September 3rd. Finally, Wedbush reiterated an "outperform" rating and set a $225.00 price target on shares of Palo Alto Networks in a research report on Monday, September 15th. Twenty-nine research analysts have rated the stock with a Buy rating, eleven have assigned a Hold rating and two have assigned a Sell rating to the company. According to MarketBeat, the stock presently has an average rating of "Moderate Buy" and an average price target of $216.00.

Palo Alto Networks Stock Down 2.7%

The firm has a market cap of $138.84 billion, a PE ratio of 129.32, a PEG ratio of 4.96 and a beta of 0.98. The stock's fifty day simple moving average is $193.79 and its two-hundred day simple moving average is $189.56.

Palo Alto Networks (NASDAQ:PANW - Get Free Report) last posted its quarterly earnings data on Monday, August 18th. The network technology company reported $0.95 earnings per share for the quarter, beating analysts' consensus estimates of $0.89 by $0.06. Palo Alto Networks had a return on equity of 17.66% and a net margin of 12.30%.The company had revenue of $2.54 billion during the quarter, compared to analyst estimates of $2.50 billion. During the same quarter last year, the company earned $0.75 EPS. The firm's revenue for the quarter was up 15.8% on a year-over-year basis. Palo Alto Networks has set its FY 2026 guidance at 3.750-3.850 EPS. Q1 2026 guidance at 0.880-0.900 EPS. On average, equities research analysts anticipate that Palo Alto Networks, Inc. will post 1.76 earnings per share for the current fiscal year.

Insider Transactions at Palo Alto Networks

In related news, EVP Lee Klarich sold 120,774 shares of the stock in a transaction dated Monday, October 6th. The shares were sold at an average price of $211.92, for a total transaction of $25,594,426.08. Following the sale, the executive vice president directly owned 149,190 shares of the company's stock, valued at approximately $31,616,344.80. This represents a 44.74% decrease in their position. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CEO Nikesh Arora sold 846,408 shares of the stock in a transaction dated Tuesday, September 23rd. The shares were sold at an average price of $204.06, for a total transaction of $172,718,016.48. Following the sale, the chief executive officer directly owned 275,013 shares in the company, valued at $56,119,152.78. This trade represents a 75.48% decrease in their ownership of the stock. The disclosure for this sale can be found here. In the last 90 days, insiders sold 1,315,130 shares of company stock valued at $260,687,367. 2.50% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Palo Alto Networks

A number of institutional investors have recently made changes to their positions in the company. Vanguard Group Inc. boosted its stake in Palo Alto Networks by 2.0% during the 2nd quarter. Vanguard Group Inc. now owns 64,016,374 shares of the network technology company's stock valued at $13,100,311,000 after purchasing an additional 1,240,830 shares during the last quarter. Geode Capital Management LLC boosted its position in shares of Palo Alto Networks by 1.1% during the second quarter. Geode Capital Management LLC now owns 15,174,029 shares of the network technology company's stock valued at $3,093,262,000 after buying an additional 169,055 shares during the last quarter. Goldman Sachs Group Inc. boosted its position in shares of Palo Alto Networks by 41.9% during the first quarter. Goldman Sachs Group Inc. now owns 7,235,406 shares of the network technology company's stock valued at $1,234,650,000 after buying an additional 2,134,735 shares during the last quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC boosted its holdings in shares of Palo Alto Networks by 16.0% during the 1st quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 6,902,048 shares of the network technology company's stock valued at $1,177,765,000 after acquiring an additional 950,765 shares during the last quarter. Finally, First Trust Advisors LP boosted its holdings in shares of Palo Alto Networks by 7.7% during the 2nd quarter. First Trust Advisors LP now owns 5,295,588 shares of the network technology company's stock valued at $1,083,689,000 after acquiring an additional 377,496 shares during the last quarter. Hedge funds and other institutional investors own 79.82% of the company's stock.

Palo Alto Networks Company Profile

Palo Alto Networks, Inc provides cybersecurity solutions worldwide. The company offers firewall appliances and software; and Panorama, a security management solution for the global control of network security platform as a virtual or a physical appliance. It also provides subscription services covering the areas of threat prevention, malware and persistent threat, URL filtering, laptop and mobile device protection, DNS security, Internet of Things security, SaaS security API, and SaaS security inline, as well as threat intelligence, and data loss prevention.

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