Palo Alto Networks (NASDAQ: PANW) shares rose after Rosenblatt Securities raised its price target to $415 from $355, maintaining a buy rating following the cybersecurity firm’s strong fourth-quarter results. The upgrade follows a broader wave of analyst revisions, with TD Cowen, Baird, Evercore ISI, Truist Securities and Morgan Stanley all adjusting their targets upward.
Fourth-quarter total revenue reached $3.41 billion, a 34% increase year-over-year and above the company’s guidance range of $3.345 billion to $3.355 billion. Non-GAAP earnings per share came in at $1.02, exceeding guidance by 4 cents and surpassing the consensus estimate of $0.98. Next-Generation Security annual recurring revenue (ARR) climbed 63% to $9.10 billion, topping guidance by $150 million and reflecting strong demand for the company’s AI-driven security solutions.
New net NGS ARR totaled approximately $970 million in the quarter, up 98% year-over-year. Remaining performance obligations (RPO) surged 34% to $21.2 billion, crossing the $20 billion threshold for the first time. Platformizations rose by about 220 net new additions in the quarter, a 44% increase, bringing the total to roughly 2,500.
Analysts highlighted the company’s ability to surpass all guided metrics in the fourth quarter. Rosenblatt noted that Palo Alto Networks also issued fiscal 2027 guidance that exceeded consensus expectations for revenue, ARR and EPS. Morgan Stanley raised its target to $394 from $387, citing robust revenue and free cash flow performance. Truist Securities reiterated its buy rating with a $435 target, pointing to growth in artificial intelligence as a key driver. Baird maintained its outperformance rating with a $420 target, while Evercore ISI set its target at $415 with a similar rating.
Palo Alto Networks’ stock has gained 90% over the past year, with a market capitalization of $295 billion and a price-to-earnings ratio of 314. InvestingPro analysis suggested the shares are overvalued relative to its fair value estimate, though sentiment remains broadly positive among sell-side firms.
