DA Davidson reduced its 12-month price target for Palo Alto Networks (NASDAQ: PANW) to $210.00 from $240.00 on Wednesday, while leaving its Buy rating intact. At the time of the note, Palo Alto Networks was trading at $164.97 with a market capitalization of $114.45 billion and carrying a price-to-earnings ratio of 103.92, as reported by InvestingPro data.
The firm's revision comes on the eve of an upcoming earnings release for Palo Alto Networks, scheduled for Tuesday, February 17 after market close - a date noted as six days away from the analyst comment.
DA Davidson analyst Rudy Kessinger expressed a constructive view on the company’s near-term revenue trajectory, saying he expects "strong upside on NGS ARR & RPOs in particular given strong channel feedback." Kessinger also suggested that guidance for fiscal 2026 would likely be "inched higher" organically after having been "just reiterated last quarter."
The research note flagged recent corporate actions as relevant to near-term growth metrics. DA Davidson observed that the acquisition of Chronosphere closed prior to the end of the quarter. The note further stated that if the CYBR acquisition were to close before the earnings release, the combined company would show "higher growth on an as-combined, pro forma basis."
In parallel corporate filings and announcements, Palo Alto Networks has completed its acquisition of CyberArk Software, converting each CyberArk share into 2.2005 shares of Palo Alto Networks common stock plus $45.00 in cash. That transaction makes CyberArk a wholly owned subsidiary of Palo Alto Networks. Separately, Palo Alto Networks finalized its purchase of Chronosphere, a provider of cloud-native observability technology intended to strengthen the firm's capabilities around managing and securing AI-driven operations.
Other sell-side activity and sector moves were noted alongside the DA Davidson update. Stifel lowered its price target for Palo Alto Networks to $200 from $225 while keeping a Buy rating. Jefferies reiterated its Buy stance and maintained a $250 price target, citing CyberArk’s reported 20% year-over-year organic net new annual recurring revenue growth as supportive. Meanwhile, Zscaler completed an acquisition of SquareX to enhance browser security functionality, with Cantor Fitzgerald maintaining an Overweight rating on Zscaler. The collection of analyst revisions and M&A activity underscores continuing strategic shifts and reassessments across the cybersecurity industry.
Summary considerations:
- The DA Davidson change reduces a previously higher target while preserving a positive recommendation.
- Near-term upside expectations are tied to NGS ARR and RPOs, according to channel feedback cited by the analyst.
- Recent acquisitions are expected to influence reported growth on an as-combined or pro forma basis depending on timing of deal closings.
These developments will be watched closely by investors and market participants as Palo Alto Networks approaches its forthcoming quarterly results.