Shares of the cybersecurity company Palo Alto Networks (NASDAQ:PANW) experienced a sharp decline in Wednesday’s after-hours trading after lowering its billings forecast for the fiscal year. This downturn extended into Thursday’s trading session, marked by a decline exceeding 5%, which prompted support from Wall Street analysts.
JP Morgan analysts, led by Brian Essex, asserted that PANW remains among the best-positioned stocks in their enterprise security coverage. The firm maintained its Overweight rating, elevating its price target from $268 to $272. However, the analysts cautioned that while optimistic, their view does not erase concerns about potential headwinds. Still, Essex emphasized that the stock’s relative strength compared to its peers remains a driving factor.
At Wedbush, analyst Dan Ives communicated to investors that the reduced forecast should not be interpreted as a bearish signal for the company. Ives highlighted that Palo Alto is witnessing robust market demand.
Wedbush articulated its “confidence” in Palo Alto, suggesting that the lowered billings rate should not adversely affect the company’s future pipeline, closure rate, or demand. As a result, the firm maintained its outperform rating and $290 price target for Palo Alto shares.
What is the Forecast for PANW Stock?
Turning to Wall Street, analysts have a Strong Buy consensus rating on PANW stock based on 20 Buys and three Holds assigned in the past three months, as indicated by the graphic below. Furthermore, the average PANW price target of $281.14 per share implies a 17.48% upside potential. This comes after a 53% rally in its share price over the past year.