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Investing.com -- BTIG cut its rating on cybersecurity firm SentinelOne to Neutral from Buy, warning that growth is slowing faster than Wall Street expects and that competitive pressures from larger rivals are intensifying.
The brokerage said it now expects SentinelOne’s annual recurring revenue (ARR) to reach $1.08 billion in fiscal 2026, up 17.5% from a year earlier but below the Street’s $1.10 billion estimate.
For fiscal 2027, BTIG cut its ARR forecast by 3% to $1.25 billion, implying growth of 15.4%. That compares with consensus estimates of $1.31 billion and expectations for growth closer to 20%.
Field checks with partners representing nearly $150 million in annual SentinelOne sales suggested a more cautious outlook, BTIG said.
While the company’s technology continues to be seen as strong and a lower-cost alternative to CrowdStrike in mid-market accounts, concerns remain over its ability to compete against larger platform vendors such as CrowdStrike, Microsoft and Palo Alto Networks.
The firm noted that current sentiment toward the stock is already negative, with second-quarter ARR guidance of $985 million largely in line with consensus.
While BTIG does not see downside to that target, it believes longer-term expectations remain too high and could face downward revisions.
SentinelOne trades at about 22.5 times estimated 2027 free cash flow, similar to peers growing at mid-teens rates. BTIG said valuation is not stretched but sees risk of further estimate cuts over the next 6–12 months, making the risk-reward profile balanced.