Cybersecurity company Palo Alto Networks (PANW) has scored rating upgrades from two top Wall Street analysts, ahead of its earnings for the fourth quarter of Fiscal 2025 on August 18. Both Piper Sandler analyst Rob Owens and Deutsche Bank analyst Brad Zelnick upgraded their ratings for Palo Alto stock to Buy from Hold. Further, Owens raised his price target for PANW stock to $225 from $200, while Zelnick increased his price forecast to $220 from $200.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Palo Alto stock is down 3.6% year-to-date, reflecting investors’ concerns about the recently announced $25 billion CyberArk Software (CYBR) acquisition.
Meanwhile, Wall Street expects Palo Alto to report earnings per share (EPS) of $0.89 for Q4 FY25, reflecting a year-over-year growth of 17.1%. Revenue is estimated to increase by 14% to $2.5 billion.
Piper Sandler Analyst Turns Bullish on PANW Stock
Piper Sandler’s Owens stated that he now has a more favorable view of Palo Alto stock based on early platformization success that has helped reaccelerate bookings and should prove durable as the traction for the company’s XSIAM offering grows. The 5-star analyst also noted more consistent free cash flow leverage moving forward with annual payments and Palo Alto Networks Financial Services (PAN-FS) turning to a tailwind after presenting challenges over the last two years.
Owens is also positive about the CyberArk acquisition, which he believes adds a very high-quality asset to Palo Alto’s portfolio while filling its largest gap. Overall, the analyst believes that the CyberArk deal will help PANW achieve a low-teens compound annual growth rate (CAGR) and improved free cash flow (FCF) margins, creating a favorable setup from here.
Is PANW Stock a Buy or Sell?
Overall, Wall Street has a Strong Buy consensus rating on Palo Alto Networks stock based on 30 Buys, six Holds, and one Sell recommendation. The average PANW stock price target of $216.33 indicates 23.3% upside potential.
