In a recent CNBC Investing Club “Morning Meeting,” host Jim Cramer expressed his views on the performance of Palo Alto Networks Inc PANW and Constellation Brands Inc STZ.
What Happened: Cramer, on Friday, noted that the U.S. stock market had a strong week, with the Dow Jones Industrial Average, S&P 500, and Nasdaq all set for significant weekly gains, CNBC reported.
He attributed this to the Federal Reserve’s indication of three expected interest rate cuts this year.
Despite this, Cramer warned investors against speculating on the timing of these rate cuts, advising them to focus on quarterly earnings instead. He also mentioned that Palo Alto Networks had been “overly punished” this year, with its shares dropping approximately 2% year-to-date, in contrast to the S&P 500’s 10% gain.
Cramer, who is considering buying more shares of the cybersecurity company, cited CEO Nikesh Arora‘s positive remarks about the company’s new “platformization” strategy as a potential indicator of future performance.
Despite a recent dip in the stock following a revenue guidance cut due to the business strategy shift, Cramer and the Club view this as short-term pain for long-term gains.
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On the other hand, Wall Street analysts have been bullish on Constellation Brands, with Piper Sandler initiating coverage with a buy-equivalent rating and a $300-per-share price target. Cramer also expressed optimism about the company’s future, predicting that the stock will “go much higher.”
Why It Matters: The short interest in Palo Alto Networks has been decreasing, indicating a more bullish sentiment among investors. This aligns with Cramer’s view that the company’s recent struggles may be temporary.
Analysts have also been providing a mix of bullish and bearish ratings for Palo Alto Networks.. The average price target for the stock is $352.03, with a high estimate of $450 and a low estimate of $265.
Price Action: Palo Alto’s stock closed at $286.78, down 0.30% from its previous close, according to data from Benzinga Pro.
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This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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