Analysts Hail Palo Alto Networks On Q1 Beat, See Huge Upside

Analysts raised price targets on Palo Alto Networks Inc's PANW Q1 beat, posting growth in every metric, including billings amid supply chain constraints.

• Piper Sandler analyst Rob Owens raised the PT to $675 from $600 (28% upside) and kept an Overweight.
• With a growing portfolio "that is clearly resonating," he believes Palo Alto is "uniquely positioned to capitalize on the favorable demand environment for security solutions."
• JMP Securities analyst Erik Suppiger raised the PT to $585 from $550 (11% upside) and kept an Outperform. 
• While the supply chain constraints were challenging and higher material costs were compressing gross margins, customers provided greater visibility into orders, leading to more appliances than the initial forecast. 
• Palo Alto's product revenue, reflecting its firewall appliance business, bagged the best growth rate in 2.5 years.
• Baird analyst Jonathan Ruykhaver raised the PT to $625 from $540 (19% upside) and kept an Outperform. 
• The analyst said that despite declines in some next-gen security growth metrics, he believes the company continues to gain traction with its multi-platform strategy. He likes the continued focus around areas of security he sees as more strategic.
• Credit Suisse analyst Phil Winslow raised the PT to $635 from $625 (21% upside) and kept an Outperform. 
• The analyst believes that Palo Alto Networks' best-in-class technology platform, large and growing on-premises installed base, broadening cloud-centric product portfolio, and management's ability to execute its vision position the company to continue gaining share in the security market.
• Raymond James analyst Adam Tindle raised the PT to $600 from $450 (14% upside) and kept an Outperform. 
• Oppenheimer analyst Ittai Kidron raised the PT to $600 from $550 and kept an Outperform. 
• The analyst remains bullish on the long-term opportunity for share gains in an expanding TAM environment.
• Truist analyst Joel Fishbein raised the PT to $600 from $525 and kept a Buy. 
• Palo Alto continues to be a "key beneficiary" of the recent cyberattacks and the remote work trend and is the best-positioned security company to benefit from vendor consolidation.
• BTIG analyst Gray Powell raised the PT to $610 from $555 (16% upside) and kept a Buy. 
• On the product revenue side, Palo Alto Network sees strong adoption of its newer appliance lines, intense refresh activity, incremental share gains, and customers ordering ahead of demand.
• Wedbush analyst Daniel Ives raised PT to $630 from $600 (20% upside) and kept an Outperform. 
• Palo Alto's quarterly results were "blow out," with healthy guidance suggesting the company's cloud-driven strategy is resonating increasingly well with cyber security customers in the field.
• Loop Capital analyst Yum Kim raised the PT to $530 from $475 and kept a Hold. 
• Despite some supply-chain issues, Palo Alto Networks was able to show accelerating product revenue growth, and he sees some tailwinds coming from price increase towards the end of the quarter. 
• BMO Capital analyst Keith Bachman raised the PT to $615 from $560 (17% upside) and kept an Outperform. 
• Bachman adds that much like Fortinet Inc FTNT, Palo Alto's product revenues had the most significant outperformance, and its product revenue visibility has also increased for the medium term.
• RBC Capital analyst Matthew Hedberg raised PT to $660 from $590 (26% upside) and kept an Outperform rating.
• Morgan Stanley analyst Keith Weiss raised the price target to $660 from $600 and maintained an Overweight rating.
• Price Action: PANW shares traded higher by 1.2% at $526.27 on the last check Friday.