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On Tuesday, Wedbush Securities adjusted its price target for Palo Alto Networks (NASDAQ:PANW) shares, reducing it from the previous $400.00 to $225.00, while retaining an Outperform rating for the cybersecurity company. Currently trading at $196.40, the stock sits near its 52-week high of $207.24, with a market capitalization of $128.9 billion. The adjustment comes ahead of the company’s anticipated financial results for FY2Q25, which are set to be released on Thursday after market close. According to InvestingPro, the company maintains a "GREAT" overall financial health score of 3.25/5.
The Wedbush analyst cited increasing momentum in Palo Alto Networks’ cybersecurity platform strategy as the reason for maintaining the Outperform rating, despite the price target revision. The company has demonstrated solid performance with revenue growth of 15% over the last twelve months, reaching $8.29 billion. The firm expects that Palo Alto Networks will report strong cybersecurity deal activity among enterprises, as the company continues to build upon its platformization strategy for the second half of 2025 and into the fiscal year 2026. For deeper insights into PANW’s growth metrics and valuation analysis, investors can access the comprehensive Pro Research Report available on InvestingPro, which covers over 1,400 US stocks.
Palo Alto Networks is considered by Wedbush to be a top cybersecurity stock to hold over the next 12-18 months. With a robust gross profit margin of 74.17% and strong return on assets of 15.54%, the company’s financial metrics support this positive outlook. This optimism is based on the company’s ability to secure a more stable pipeline of platformization deals and its growing cloud penetration, which is anticipated to remain a key growth driver.
The analyst noted that there has been a noticeable increase in deal flow within the cybersecurity sector over recent months. This trend is expected to contribute positively to Palo Alto Networks’ customer deployment momentum, with the company’s platform approach now becoming a central focus.
While Wedbush does not expect the FY2Q25 earnings report to reveal any significant surprises, the firm believes that Palo Alto Networks has laid down the necessary groundwork for substantial growth in the latter half of 2025. This growth is likely to be supported by an increasingly complex and active cyber threat landscape.
In other recent news, Palo Alto Networks has been the focus of various analysts. Rosenblatt Securities raised its price target for the company to $235, citing a robust second quarter for the fiscal year 2025, driven by a successful adoption of Cortex/XSIAM and solid customer retention for Prisma Cloud. A significant deal with the UK Emergency Services Network, valued at over $120 million in annual recurring revenue, is expected to propel Next-Generation Annual Recurring Revenue (ARR) beyond the company’s projected growth range.
KeyBanc Capital Markets also increased its price target for Palo Alto Networks to $240, following positive feedback from the company’s partners and an encouraging fiscal second-quarter setup. KeyBanc anticipates potential upside to their forecast for the company’s F2Q billings.
Conversely, TD Cowen maintained a positive outlook on Palo Alto Networks shares, reiterating a Buy rating and a $210.00 price target. The firm’s confidence is based on the anticipation of a strong demand rebound for its Next-Generation Security (NGS) products.
RBC Capital Markets reaffirmed their positive stance on Palo Alto Networks, maintaining an Outperform rating and a $225.00 price target for the cybersecurity company’s shares. The firm anticipates that Palo Alto Networks may slightly surpass estimates based on their recent checks.
Lastly, Barclays (LON:BARC) analyst Saket Kalia maintained an Overweight rating for Palo Alto Networks stock, with a steady price target of $213.00. Kalia projects approximately 9% year-over-year growth in second-quarter Remaining Performance Obligations (RPO) bookings. These are the recent developments for Palo Alto Networks.
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