Street Calls of the Week
Investing.com - CyberArk Software (NASDAQ:CYBR) was downgraded from Buy to Hold by Canaccord Genuity on Wednesday, though the firm raised its price target to $502.00 from $440.00. The company has demonstrated impressive performance with a 67.6% return over the past year and maintains robust gross margins of 76.86%.
The rating change follows Palo Alto Networks’ (NASDAQ:PANW) July 30 announcement of its formal intent to acquire CyberArk for approximately $25 billion in total equity value, after earlier reports of negotiations between the companies. According to InvestingPro, CyberArk’s revenue has grown 39.45% over the last twelve months, making it an attractive acquisition target.
Canaccord analyst Kingsley Crane noted the strategic benefits of the deal, stating that Palo Alto Networks will "materially strengthen its platform by elevating its identity security capabilities" at a time when identity security is becoming more critical for enterprise customers. InvestingPro analysis shows CyberArk maintains a GOOD overall financial health score, with 14+ additional exclusive insights available to subscribers.
The acquisition comes as identity security grows increasingly important due to the proliferation of machine identities and emerging agentic workflows within large enterprises, according to the research note.
Palo Alto Networks expects the acquisition to immediately boost revenue growth and gross margins, with the deal becoming accretive to free cash flow per share by fiscal year 2028.
In other recent news, CyberArk Software has announced a special general meeting of shareholders to vote on a proposed merger with Palo Alto Networks. The meeting is scheduled for November 13, 2025, and will take place at CyberArk’s offices in Petach-Tikva, Israel. This proposed transaction involves an offer from Palo Alto Networks of $45 in cash plus 2.2005 shares of Palo Alto Networks for each CyberArk share. In light of this pending acquisition, JMP Securities has downgraded CyberArk’s stock rating from Market Outperform to Market Perform. Additionally, CyberArk has been selected to join the Microsoft Security Store Partner Ecosystem, enhancing its collaboration with Microsoft Security technologies. This partnership aims to streamline cybersecurity solutions for organizations by offering trusted solutions with verified integrations. CyberArk also unveiled new discovery tools for its Machine Identity Security portfolio to address growing security challenges. These recent developments highlight significant strategic moves by CyberArk in the cybersecurity industry.
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