Palo Alto Networks' Q4 results likely to set stage for growth in fiscal '26: Wedbush

[Palo Alto Networks headquarters in Silicon Valley]
Sundry Photography

Palo Alto Networks (NASDAQ:PANW [https://seekingalpha.com/symbol/PANW]) is set to report fiscal fourth-quarter results after the close of trading, and Wedbush Securities expects the quarterly figures to set the stage for continued growth in fiscal 2026.

“PANW remains one of our favorite cybersecurity names to own over the next 12–18 months as the company generates a more stable pipeline of platformization deals with cloud penetration while seeing incremental strength in deal flow over the past few months based on our recent checks,” analysts at the firm wrote in a note to clients. “Despite the recent oversold drawdown in PANW's stock tied to the CYBR acquisition, we view this as a golden buying opportunity as the company completes its platform approach and provides a one-stop shop for cybersecurity.”

The investment firm has an Outperform rating and $225 price target on Palo Alto.

Looking to the quarter, Wedbush said the estimates from Wall Street and Palo Alto's own guidance is “beatable,” as the Nikesh Arora-led firm works on accelerating its platform strategy over the next few years. Annual recurring revenue per platformized customer is expected to tick up sequentially, as Palo Alto works on converting existing customers and the long-term Next-Generation Security ARR of $15B by 2030 is still intact, the analysts added.

The company expects Next-Generation Security ARR of $5.52B to $5.57B and remaining performance obligations of $15.3B.

In recent checks, Wedbush's analysts said they see the potential for Palo Alto to gain share in the cybersecurity industry, particularly in the federal part of the business, as cyberattacks from state actors and non-state actors continue to rise. They also said they expect to hear more about the firewall refresh cycle, which could wind up boosting revenue in the back half of 2025.

Aside from those issues, Palo Alto is likely to give updates on its artificial intelligence suite of products, along with further updates on its pending [https://seekingalpha.com/news/4474241-palo-alto-networks-to-acquire-cyberark-for-25b] CyberArk (CYBR [https://seekingalpha.com/symbol/CYBR]) acquisition, which Wedbush said it sees as a “strategic home-run” that adds further growth.

A consensus of analysts expect [https://seekingalpha.com/symbol/PANW/earnings/estimates?period=quarterly] Palo Alto to earn $0.89 per share on $2.5B in revenue.

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