TLDR
- PANW dropped 10.3% this week despite beating Q4 revenue and EPS estimates
- Revenue rose 34.5% year over year to $3.41 billion in fiscal Q4
- Full-year FY2027 guidance of $14.1B-$14.2B topped Wall Street estimates
- Palo Alto acquired AI platform Console for around $500 million in cash and stock
- Stock is still up roughly 81% year to date despite this week’s pullback
Palo Alto Networks (PANW) stock dropped 10.3% this week even after the company posted a strong fiscal Q4 earnings report. The stock opened Friday at $333.26.
Palo Alto Networks, Inc., PANW
The results beat on both the top and bottom lines. Revenue came in at $3.41 billion, up 34.5% year over year, topping the average analyst estimate by $60 million. Adjusted EPS hit $1.02, above the $0.98 consensus and up from $0.95 in the same quarter last year.
The sell-off came down to expectations. PANW had already surged more than 80% in 2026 heading into the print, leaving little room for anything less than a blowout.
Annualized recurring revenue for the next-generation security segment jumped 63% year over year to $9.1 billion. Remaining performance obligations rose 34% to $21.2 billion.
Guidance Tops Estimates
For the full fiscal year 2027, Palo Alto guided for revenue between $14.1 billion and $14.2 billion, above the prior Wall Street estimate of $13.83 billion. Adjusted EPS guidance came in at $4.16 to $4.19, ahead of the $4.11 analyst forecast.
Q1 FY2027 EPS guidance was set at $0.96 to $0.98.
Alongside the earnings, Palo Alto announced it acquired Console, an agentic AI platform for managing and resolving enterprise alerts. The deal was valued at around $500 million in cash and stock.
Analyst Reaction
Wall Street stayed largely bullish. DA Davidson raised its price target to $420. Susquehanna lifted to $415. BTIG bumped its target to $404 with a buy rating. Cantor Fitzgerald kept an overweight rating.
Scotiabank was the outlier, downgrading PANW from sector outperform to hold.
The consensus rating across 49 analysts sits at “Moderate Buy” with an average price target of $385.67, well above where the stock is trading now.
Munich Reinsurance reduced its PANW position by 77.8% during Q2, selling 237,634 shares and leaving it with 67,942 shares worth around $23.2 million.
Over the past 90 days, insiders sold a combined $11.15 million worth of stock, including a 20,000-share sale by Director James Goetz in June at $279.90 per share.
PANW trades at a price-to-earnings ratio of 653, which gives the stock a very high bar to clear each quarter.
The 52-week range runs from $139.57 to $398.88. The stock’s 50-day moving average is $350.18, and the 200-day sits at $254.82.
Sector pressure also played a role this week. Zscaler’s softer FY2027 growth outlook weighed on cybersecurity stocks broadly, hitting sentiment across the group.
Despite the pullback, PANW is still up roughly 81% year to date.
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