Palo Alto Networks stock rating reiterated at Overweight by Cantor Fitzgerald

Investing.com - Cantor Fitzgerald has reiterated an Overweight rating and $250.00 price target on Palo Alto Networks (NASDAQ:PANW) following the company’s strong quarterly performance. This target represents a 25% upside from the current price of $199.90, with analyst consensus remaining bullish at 1.76 (Buy).

The cybersecurity firm exceeded FactSet consensus expectations across multiple metrics, including revenue, Next-Gen Annual Recurring Revenue (ARR), Remaining Performance Obligation (RPO), Free Cash Flow (FCF), and earnings per share. InvestingPro data shows PANW generated $9.22 billion in revenue over the last twelve months, representing 14.87% growth, with robust free cash flow of $3.47 billion.

Palo Alto Networks also announced its acquisition of Chronosphere, a next-generation observability platform designed to scale with artificial intelligence deployments, expanding its capabilities in the observability space. As a prominent player in the software industry, PANW continues to strengthen its market position with strategic acquisitions.

The company has raised its long-term Next-Generation Security ARR target to $20 billion by fiscal year 2030, up from its previous target of $15 billion. This increase is driven by momentum across its Secure Access Service Edge (SASE), Cortex, and AI-Ready Security (AIRS) offerings, along with an expanded total addressable market as it moves into identity, observability, and quantum readiness. With a 5-year revenue CAGR of 22% and operating with a moderate debt level, PANW appears well-positioned to pursue this ambitious growth target.

Cantor Fitzgerald expressed bullishness on Palo Alto Networks’ long-term strategy, noting the company is positioning itself to become "the full-stack security and observability platform for the AI era." With an "GREAT" overall financial health score of 3.03 according to InvestingPro, which offers 13 additional ProTips and a comprehensive research report on PANW among 1,400+ US equities, the company appears fundamentally sound for its ambitious AI-focused transformation.

In other recent news, Palo Alto Networks reported robust first-quarter fiscal 2026 earnings, surpassing expectations with a revenue of $2.47 billion, slightly above the consensus estimate of $2.46 billion, and achieving a 16% year-over-year growth. The company also reported non-GAAP earnings per share of $0.93, exceeding the consensus estimate of $0.89, and a non-GAAP operating margin of 30.2%, beating the expected 29.1%. Palo Alto Networks raised its full-year outlook by $20 million after exceeding its revenue and annual recurring revenue (ARR) guidance.

Bernstein raised its price target for the company to $210, maintaining an Outperform rating, while Citizens reiterated a Market Outperform rating with a $250 price target. Truist Securities also maintained a Buy rating, setting its price target at $220. UBS, however, lowered its price target to $220 from $230, citing a mixed outlook despite strong ARR, remaining performance obligations (RPO), and free cash flow (FCF) performances. TD Cowen held its Buy rating, highlighting the company’s solid performance with Next-Generation Security ARR growing 29% year-over-year and RPO increasing 24%, both surpassing analyst estimates.

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