Palo Alto Networks (NASDAQ:PANW) Shares Gap Down After Analyst Downgrade

Palo Alto Networks, Inc. (NASDAQ:PANW) shares gapped down prior to trading on Wednesday after Stifel Nicolaus lowered their price target on the stock from $200.00 to $185.00. The stock had previously closed at $163.50, but opened at $149.55. Stifel Nicolaus currently has a buy rating on the stock. Palo Alto Networks shares last traded at $153.0770, with a volume of 14,522,564 shares.

Other equities research analysts have also issued research reports about the company. Susquehanna lowered their price objective on Palo Alto Networks from $230.00 to $200.00 and set a “positive” rating on the stock in a research report on Wednesday. The Goldman Sachs Group lowered their price target on shares of Palo Alto Networks from $240.00 to $224.00 and set a “buy” rating on the stock in a report on Wednesday. Morgan Stanley restated an “overweight” rating and set a $223.00 price target (down previously from $245.00) on shares of Palo Alto Networks in a research report on Wednesday. Deutsche Bank Aktiengesellschaft cut their price objective on shares of Palo Alto Networks from $240.00 to $220.00 and set a “buy” rating for the company in a report on Wednesday. Finally, Barclays set a $200.00 target price on shares of Palo Alto Networks and gave the stock an “overweight” rating in a research note on Monday, February 9th. Thirty-three research analysts have rated the stock with a Buy rating and nine have assigned a Hold rating to the stock. According to MarketBeat, Palo Alto Networks has an average rating of “Moderate Buy” and an average target price of $215.68.

Insider Activity at Palo Alto Networks

In related news, EVP Lee Klarich sold 120,774 shares of Palo Alto Networks stock in a transaction dated Wednesday, December 3rd. The stock was sold at an average price of $191.91, for a total value of $23,177,738.34. Following the sale, the executive vice president directly owned 327,645 shares in the company, valued at approximately $62,878,351.95. The trade was a 26.93% decrease in their position. The transaction was disclosed in a filing with the SEC, which is accessible through this hyperlink. Also, CAO Josh D. Paul sold 800 shares of the business’s stock in a transaction that occurred on Friday, January 2nd. The stock was sold at an average price of $184.81, for a total value of $147,848.00. Following the sale, the chief accounting officer owned 46,005 shares of the company’s stock, valued at approximately $8,502,184.05. This trade represents a 1.71% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last 90 days, insiders sold 260,542 shares of company stock valued at $49,910,995. 1.40% of the stock is owned by corporate insiders.

Key Stories Impacting Palo Alto Networks

Here are the key news stories impacting Palo Alto Networks this week:

• Positive Sentiment: Q2 results beat estimates—EPS $1.03 and revenue roughly $2.59B; Next‑Gen Security ARR grew ~33% and RPO rose, supporting recurring revenue momentum. Palo Alto Networks Reports Fiscal Second Quarter 2026 Financial Results
• Positive Sentiment: Company raised full‑year revenue outlook to about $11.28–11.31B, signaling continued top‑line strength from its platform strategy. Palo Alto Networks Lifts Revenue Outlook as Second‑Quarter Profit Jumps (WSJ)
• Positive Sentiment: Management is investing to secure the AI/agentic endpoint (Koi acquisition) and expand capabilities (CyberArk, Chronosphere), which could strengthen long‑term competitive positioning. Palo Alto Announces Intent to Acquire Koi (PRNewswire)
• Neutral Sentiment: Analysts and firms are mixed—some reaffirmed outperform/buy ratings and cited long‑term upside while others trimmed price targets; overall street sentiment remains largely constructive but cautious. Jefferies: Palo Alto to emerge stronger despite M&A headwinds
• Negative Sentiment: Management lowered near‑term profit guidance, citing higher integration and acquisition costs—this cut to the profit outlook is the primary driver of the share decline. Palo Alto shares fall as deal costs pile up (Reuters)
• Negative Sentiment: Multiple brokers trimmed price targets and adjusted models after the guidance update (Deutsche, Goldman, Scotiabank, Loop, Stifel, BMO, Needham, Susquehanna, etc.), adding selling pressure. Analyst price‑target adjustments (MarketScreener example)
• Negative Sentiment: Sector and AI‑software weakness amplified the move—CEO sought to defend the company’s differentiation, but market sentiment for high‑growth software names remains tenuous. Palo Alto shares sink as CEO defends strategy (CNBC)

Institutional Investors Weigh In On Palo Alto Networks

Large investors have recently modified their holdings of the business. Norges Bank purchased a new stake in shares of Palo Alto Networks in the fourth quarter valued at approximately $1,415,364,000. Vanguard Group Inc. grew its holdings in Palo Alto Networks by 4.1% in the 4th quarter. Vanguard Group Inc. now owns 67,929,063 shares of the network technology company’s stock valued at $12,512,533,000 after buying an additional 2,659,100 shares in the last quarter. Bank of America Corp DE increased its stake in shares of Palo Alto Networks by 11.9% in the 4th quarter. Bank of America Corp DE now owns 19,375,486 shares of the network technology company’s stock worth $3,568,964,000 after acquiring an additional 2,065,776 shares during the last quarter. ABN AMRO Bank N.V. purchased a new position in shares of Palo Alto Networks during the 2nd quarter worth $340,883,000. Finally, Victory Capital Management Inc. raised its holdings in shares of Palo Alto Networks by 108.3% during the 3rd quarter. Victory Capital Management Inc. now owns 2,467,692 shares of the network technology company’s stock worth $502,263,000 after acquiring an additional 1,282,738 shares during the period. Hedge funds and other institutional investors own 79.82% of the company’s stock.

Palo Alto Networks Stock Performance

The firm’s 50-day moving average price is $180.25 and its two-hundred day moving average price is $191.93. The stock has a market cap of $106.19 billion, a price-to-earnings ratio of 84.17, a PEG ratio of 3.91 and a beta of 0.75.

Palo Alto Networks (NASDAQ:PANW) last issued its earnings results on Tuesday, February 17th. The network technology company reported $1.03 EPS for the quarter, topping analysts’ consensus estimates of $0.94 by $0.09. Palo Alto Networks had a net margin of 12.96% and a return on equity of 18.42%. The company had revenue of $2.59 billion for the quarter, compared to the consensus estimate of $2.58 billion. During the same period in the previous year, the firm earned $0.81 earnings per share. Palo Alto Networks’s quarterly revenue was up 14.9% compared to the same quarter last year. Palo Alto Networks has set its FY 2026 guidance at 3.650-3.700 EPS and its Q3 2026 guidance at 0.780-0.800 EPS. As a group, sell-side analysts expect that Palo Alto Networks, Inc. will post 1.76 earnings per share for the current fiscal year.

About Palo Alto Networks

Palo Alto Networks (NASDAQ: PANW) is a cybersecurity company founded in 2005 and headquartered in Santa Clara, California. The firm develops a broad suite of security products and services designed to prevent successful cyberattacks and protect enterprise networks, clouds, and endpoints. Built around a platform strategy, its offerings target threat prevention, detection, response and governance across hybrid and multi-cloud environments.

The company’s product portfolio includes next‑generation firewalls as a core on‑premises capability, alongside cloud‑delivered security services and software for securing public and private clouds.