Stephens Starts Palo Alto Networks (PANW) at Equal Weight, PT $205

Stephens analyst Todd Weller initiates coverage on Palo Alto Networks (NASDAQ: PANW) with a Equal Weight rating and a price target of $205.00.

The analyst comments "We are initiating coverage of Palo Alto Networks with an Equal-Weight rating and a target price of $205 based on a target EV/revenue multiple of 13x applied to our FY26 revenue estimate. • As one of the largest, pure-play cybersecurity companies globally, we believe that Palo Alto Networks is well positioned with a scale advantage. • We believe that Palo Alto has a strong leadership position in the network security market. While we expect growth of physical appliances to be gated by the secular shift to cloud and consuming network security as a cloud service, we believe that with a strong cloud firewall and SASE offering Palo Alto is well-positioned to benefit from the secular growth areas in network security. • We believe that as a multi-platform play Palo Alto is well positioned to benefit from multiple growth opportunities, including cloud security and security operations. Over the last year, Palo Alto has been executing well in driving larger platformization deals. • We believe that Palo Alto has established a strong track record with respect to profitability. We believe that cash flow sustainability represents a key area of focus for investors and our view is that Palo Alto is well positioned to continue to deliver on this front despite some moving pieces. • Shares of Palo Alto Networks have been a strong performer over the last 12 months, which we attribute to the company’s strong fundamental performances following a period where we believe a lot of moving pieces (platformization impacts on billings, metric shift, etc.) yielded some concerns about the forward growth outlook. While we are positive on the company’s fundamental outlook, we prefer to look for a more attractive entry point for the stock."

For an analyst ratings summary and ratings history on Palo Alto Networks click here. For more ratings news on Palo Alto Networks click here.

Shares of Palo Alto Networks closed at $172.76 yesterday.

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