BTIG analyst Gray Powell has maintained their neutral stance on PANW stock, giving a Hold rating today.
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Gray Powell’s rating is based on a combination of factors that reflect both positive and cautious elements in Palo Alto Networks’ recent performance and outlook. The company reported strong fourth-quarter results for fiscal year 2025, with notable growth in its Next-Generation Security Annual Recurring Revenue (NGS ARR), surpassing both internal and market expectations. However, the growth was partly attributed to the acquisition of Protect AI, which contributed to the revenue figures, raising concerns about the sustainability of this growth without such acquisitions.
Furthermore, while the guidance for fiscal year 2026 suggests continued growth, with revenue and NGS ARR projections slightly above market expectations, the outlook appears more aggressive compared to previous years. This includes a significant increase in net new ARR, which may pose challenges. Additionally, the valuation of Palo Alto Networks is relatively high compared to its peers, which limits the potential upside. These factors combined lead to a Hold rating, reflecting a balanced risk-reward scenario.
PANW’s price has also changed moderately for the past six months – from $208.280 to $176.170, which is a -15.42% drop .