Palo Alto Networks stock price target raised to $135 by Guggenheim

Investing.com - Guggenheim raised its price target on Palo Alto Networks (NASDAQ:PANW) to $135.00 from $130.00 on Tuesday, while maintaining a Sell rating on the cybersecurity company’s stock. According to InvestingPro data, analyst targets for PANW currently range from $130 to $236, with the stock trading at notably high valuation multiples.

The price target adjustment follows Palo Alto Networks’ F4Q25 results, which were described as "largely in line with consensus to a little better," with particularly strong remaining performance obligations (RPO). The company’s fiscal year 2026 guidance exceeded consensus estimates. The company has maintained strong financial performance, with revenue reaching $8.87 billion and a healthy gross profit margin of 73.56%.

Guggenheim noted that while F4Q RPO was strong due to very large deals, management indicated that contract duration increased both year-over-year and quarter-over-quarter, which impacts how RPO should be interpreted as a business momentum indicator.

The firm’s analysis showed that new annual recurring revenue (ARR) for the entire company was "flattish" for the last two quarters after six consecutive quarters of decline. Guggenheim attributed the positive stock reaction primarily to the company’s forward guidance rather than its fourth-quarter performance.

Despite recognizing the "significant value" Palo Alto Networks has built over the years, Guggenheim maintained its Sell rating, stating it believes that value is "less than reflected in the current stock price." InvestingPro analysis reveals 14 additional investment tips and a comprehensive Fair Value assessment for PANW, helping investors make more informed decisions about the stock’s true value potential.

In other recent news, Palo Alto Networks has reported strong fourth-quarter fiscal 2025 results, with revenue reaching $2.54 billion, surpassing analyst expectations of $2.50 billion, marking a 15% increase year-over-year. The company also posted non-GAAP earnings per share of $0.95, exceeding the consensus estimate of $0.88. The cybersecurity firm achieved a Next-Generation Security Annual Recurring Revenue (NGS-ARR) of $5,580 million, reflecting a 32% year-over-year growth. Analysts from BTIG noted that this performance slightly exceeded their estimate and the Street consensus.

Stifel and TD Cowen both reiterated their Buy ratings on Palo Alto Networks, with price targets set at $225.00 and $230.00, respectively, highlighting the company’s strong fiscal performance and positive outlook for fiscal year 2026. Citizens JMP analyst Trevor Walsh also reiterated a Market Outperform rating with a $212.00 price target, emphasizing the company’s earnings performance. Jefferies maintained its Buy rating with a $235.00 target, citing strong free cash flow performance, which reached $955 million for the quarter, surpassing consensus expectations.

The company’s remaining performance obligations grew 24% year-over-year, marking the highest growth rate in seven quarters, while bookings growth accelerated to its highest level in 2.5 years. The macroeconomic environment appears favorable for Palo Alto Networks, according to TD Cowen, supporting the firm’s positive outlook.

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