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Investing.com - Palo Alto Networks (NASDAQ:PANW), a prominent player in the software industry with a market capitalization of $117.5 billion, demonstrated resilience in its fiscal fourth quarter with strong results across multiple metrics, according to KeyBanc. InvestingPro data shows the company maintains a robust gross profit margin of 73.6%.
The cybersecurity firm reported significant outperformance in product revenue, RPO (remaining performance obligations), and operating margin, though its next-generation security annual recurring revenue showed less upside than in previous quarters. The company’s revenue grew by approximately 14% over the last twelve months to $8.87 billion, while maintaining strong cash flows that adequately cover interest payments.
KeyBanc maintained its Sector Weight rating on Palo Alto Networks while noting the company’s fiscal year 2026 guidance exceeded expectations across all key metrics including revenue, NGS ARR, RPO, EBIT, and free cash flow.
The firm highlighted that Palo Alto’s diversification toward software firewall form factors and next-generation solutions helped insulate it from headwinds that affected other network security peers during the second calendar quarter.
Management expects the combined Palo Alto Networks and CyberArk entity to achieve over 40% free cash flow margins by fiscal year 2028, though KeyBanc expressed some near-term caution regarding subscription revenue acceleration given the mid-teens organic cRPO bookings growth projected for fiscal year 2026. According to InvestingPro analysis, the stock currently trades at premium multiples, with 12+ additional exclusive insights available for subscribers. Get access to the comprehensive Pro Research Report for deep-dive analysis of PANW’s valuation and growth prospects.
In other recent news, Palo Alto Networks reported strong fourth-quarter fiscal 2024 results, with revenue increasing by 15.8% compared to the same period last year. The company also saw significant growth in its Next-Generation Security Annual Recurring Revenue (NGS ARR), which rose by 32% year-over-year, and its Remaining Performance Obligation (RPO), which grew by 24%. Following these results, Stifel reiterated its Buy rating with a $225 price target, while BofA Securities upgraded the stock from Neutral to Buy, citing strong growth metrics. Evercore ISI maintained its Outperform rating, highlighting the company’s software firewalls as a major contributor to performance gains. UBS raised its price target to $200, describing the fourth-quarter performance as a positive shift after the Cybr acquisition. Guggenheim adjusted its price target to $135, noting that the fiscal year 2026 guidance exceeded consensus estimates. These developments reflect a positive sentiment among analysts regarding Palo Alto Networks’ recent performance and future prospects.
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