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Investing.com - Rosenblatt raised its price target on Palo Alto Networks (NASDAQ:PANW) to $225.00 from $215.00 on Tuesday, while maintaining a Buy rating following the cybersecurity company’s fourth-quarter results. According to InvestingPro data, the stock currently trades at a high earnings multiple of 93.8x, reflecting the market’s strong growth expectations for this prominent player in the software industry.
Palo Alto Networks reported total revenue of $2.54 billion for the quarter, representing a 16% year-over-year increase and exceeding consensus estimates. Product revenue growth was particularly strong at 19% year-over-year, while maintaining an impressive gross profit margin of 73.56% over the last twelve months.
The company’s Next-Generation Security Annual Recurring Revenue (NGS ARR) rose 32% year-over-year to $5.58 billion, driven by its platformization strategy and customer adoption of XSIAM, Software (ETR:SOWGn) Firewalls, and SASE solutions.
Profitability metrics also surpassed expectations, with Palo Alto Networks reporting pro forma earnings per share of $0.95, approximately $0.06 above analyst estimates.
The company provided guidance for 26-27% year-over-year NGS ARR growth, 14% year-over-year revenue growth, and pro forma earnings per share of $0.13, ahead of prior consensus expectations, with shares rising approximately 5% following the announcement. The company maintains a strong financial health score of GOOD according to InvestingPro metrics, with sufficient cash flows to cover its interest payments.
In other recent news, Palo Alto Networks has reported strong financial results that have captured the attention of several analyst firms. RBC Capital reiterated its Outperform rating, noting that the company’s fiscal year-end results exceeded expectations across all metrics, with forward guidance for fiscal year 2026 surpassing market expectations. Scotiabank (TSX:BNS) also maintained a Sector Outperform rating while raising its price target to $228, citing the company’s robust fourth-quarter performance, which included significant growth in product revenue and free cash flow margins.
Cantor Fitzgerald reiterated an Overweight rating, highlighting Palo Alto Networks’ success in exceeding FactSet consensus expectations across revenue, Next-Gen ARR, RPO, free cash flow, and earnings per share. BMO Capital increased its price target to $225 following a solid report that included fiscal year 2026 Next-Generation Security Annual Recurring Revenue growth guidance of 26-27% year-over-year. Mizuho (NYSE:MFG) maintained its Outperform rating with a $210 price target, emphasizing the company’s 16% year-over-year revenue growth, which surpassed both Mizuho’s and Wall Street’s expectations.
These developments underscore Palo Alto Networks’ continued momentum and strong market performance.
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