Overview
Jefferies has maintained its Buy rating on Palo Alto Networks and left unchanged a $250.00 price target on the stock, a level that represents about a 50% upside from the current quoted price of $166.55. The research house pointed to incoming contributions from CyberArk and recent company moves as central to its continued bullish stance.
CyberArk performance and deal timing
Jefferies highlighted CyberArk's fourth-quarter results, noting a 20% year-over-year increase in organic net new annual recurring revenue (NNARR). The firm characterized this growth as indicative of CyberArk's healthy underlying business. Jefferies also said the Palo Alto Networks-CyberArk transaction is expected to close "imminently," and underscored that CyberArk's revenue strength is notable given that firms sometimes see slowing performance ahead of deal closings.
Expectations for fiscal 2027
Analysts at Jefferies expressed heightened optimism about the acquisition's long-term impact on Palo Alto Networks, particularly in fiscal year 2027. The firm said Palo Alto Networks will revise its compensation plans in FY27 to incorporate CyberArk, and Jefferies anticipates that top-line synergies from the deal will materialize during that fiscal year. These points were presented as contributors to the company's future growth trajectory.
Company growth and recent strategic actions
Palo Alto Networks itself has been growing at a solid pace, with revenue up 15.3% over the last twelve months. The company also completed its acquisition of Chronosphere, a cloud-native observability platform provider, positioning itself to better handle and secure the large data volumes required for AI-driven operations. Separately, Palo Alto Networks and Google Cloud announced an expansion of their strategic partnership intended to bolster security across AI development and deployment in cloud environments.
Jefferies referenced a Palo Alto Networks report that found 99% of surveyed companies experienced at least one attack on their AI infrastructure in the past year. That finding was cited in conjunction with the company’s recent strategic moves, including the Chronosphere purchase and the Google Cloud partnership.
Market and analyst reactions
Other analyst actions were noted alongside Jefferies' call. Guggenheim upgraded Palo Alto Networks from Sell to Neutral, citing the company’s recent strategic acquisitions. Citizens reiterated its Market Outperform rating, pointing to positive industry feedback on the company’s platformization potential. DA Davidson maintained a Buy rating and set a $240 price target following an investor call with the company’s senior leadership. These assessments were presented as part of the broader market perception around Palo Alto Networks' strategic direction.
Bottom line
Jefferies' continued Buy on Palo Alto Networks rests on the combination of CyberArk's reported NNARR growth, expectations for deal-close timing, and forecasts for FY27 synergies and compensation integration. These elements, together with recent acquisitions and partnership expansions, form the basis for the firm's $250 price target relative to the current trading price of $166.55.