Palo Alto Networks Inc. (NASDAQ: PANW) shares rose about 3% on Thursday, driven by a broader rally in cybersecurity stocks following strong earnings from peers. Bullish analyst sentiment also supported the stock ahead of the company’s September 1 earnings report.

Nasdaq futures rose 0.82%, while S&P 500 futures gained 0.28% during the session.

CrowdStrike Results Lift Cybersecurity Stocks

The rally followed fiscal second-quarter results from CrowdStrike Holdings Inc. (NASDAQ: CRWD), released after Wednesday’s closing bell. CrowdStrike reported revenue of $1.47 billion, beating the $1.44 billion estimate. Adjusted earnings of 31 cents per share also topped the 29-cent estimate.

These results strengthened confidence in cybersecurity demand. Investors have also favored large technology companies as spending on artificial intelligence infrastructure accelerates.

Technical Analysis

Palo Alto Networks remains in a long-term uptrend. At $356.75, the stock traded about 4.5% above its 50-day simple moving average of $341.36. It also stood about 56% above its 200-day SMA of $228.74.

The 20-day SMA remains above the 50-day average. In addition, the 50-day SMA crossed above the 200-day average in May. Both signals support the longer-term bullish trend.

However, momentum has cooled. The moving average convergence divergence indicator sits below its signal line. Its histogram is also negative. Therefore, the stock may need fresh buying pressure to extend its rally.

Resistance sits near $399, close to the 52-week high of $398.88. Support stands near $315.

Earnings And Analyst Outlook

Palo Alto Networks is scheduled to report earnings on September 1. Wall Street expects earnings of 88 cents per share, down from 95 cents a year earlier. Analysts forecast revenue of $3.35 billion, up from $2.54 billion.

The stock carries a Buy consensus rating and an average price forecast of $380.83.

BTIG maintained its Buy rating and $380 forecast on Wednesday. JPMorgan raised its forecast to $384 from a previous level and kept an Overweight rating on Tuesday. Benchmark lifted its forecast to $400 and maintained a Buy rating on Monday.

What the Numbers Show

Analyst expectations indicate a divergence between top-line growth and bottom-line profitability for the upcoming quarter. While revenue is forecast to grow significantly from $2.54 billion to $3.35 billion, expected earnings per share are projected to decline from 95 cents to 88 cents. This suggests that despite robust sales growth, margin pressures or increased costs may impact net profitability in the near term.

Benzinga Edge Rankings

Palo Alto Networks has a momentum score of 97.03 and a growth score of 76, according to the Benzinga Edge stock rankings. However, its value score stands at just 3.38.

The scores reflect strong price performance and growth expectations. Still, the company’s premium valuation raises the stakes for its earnings and guidance.

ETF Exposure

Palo Alto Networks has a 9.43% weighting in the First Trust Nasdaq Cybersecurity ETF (NASDAQ: CIBR). It also accounts for 8.06% of the Global X Cybersecurity ETF (NASDAQ: BUG) and 6.64% of the WisdomTree Cybersecurity Fund (NASDAQ: WCBR).

As a result, large inflows or outflows from those funds could affect demand for the stock.

PANW Price Action

Palo Alto Networks shares traded at $356.75 at the time of publication on Thursday.

Palo Alto Networks (NASDAQ: PANW) and NTT DATA have announced a multi-year global strategic alliance targeting $1 billion in joint business by 2029. This marks Palo Alto’s first strategic alliance of this kind with a global systems integrator.

The partnership combines Palo Alto Networks' AI-powered security platforms with NTT DATA's consulting, engineering, and managed services. It aims to help enterprises securely adopt artificial intelligence while modernizing cybersecurity infrastructure.

Strategic Focus Areas

The alliance will initially address cybersecurity challenges in highly regulated industries, including financial services, healthcare, manufacturing, and the public sector. Solutions will span six strategic transformation areas:

• Autonomous Security Operations Center (SOC): Modernizing operations with Agentic AI to detect and respond to machine-speed cyber threats.
• AI Governance: Embedding governance and risk management throughout the AI lifecycle for scalable innovation.
• Identity Security: Protecting human, machine, and AI agent identities through a unified framework.
• Zero Trust & SASE: Securing users and data via unified zero trust architecture with AI-driven threat detection.
• Resilient Cloud: Improving visibility and compliance across multi-cloud environments with AI-enabled security posture management.
• Firewall Modernization: Reducing complexity and strengthening enterprise security through updated firewall environments.

What the Numbers Show

NTT DATA is deploying more than 2,000 Palo Alto Networks-certified professionals alongside dedicated Forward Deployed Engineers. This resource allocation underscores the operational scale required to meet the $1 billion revenue target by 2029. Additionally, NTT DATA brings over 7,500 cybersecurity professionals, 70+ delivery centers, and 20+ Cyber Defense Centers to the collaboration.

Market Context

Palo Alto Networks shares were down 1.88% at $353.01 in premarket trading on Thursday, reflecting broader market downturns with S&P 500 futures down 0.5%. The stock trades 0.6% below its 20-day simple moving average (SMA) of $355.13 but remains 6.3% above its 50-day SMA of $332.16. The Relative Strength Index (RSI) stands at 52.49, indicating a neutral stance.

Earnings Preview

Palo Alto Networks is set to report earnings on Sept. 1. Analysts estimate earnings per share (EPS) of 88 cents, down from previous estimates of 95 cents. Revenue estimates stand at $3.35 billion, up from $2.54 billion. The stock carries a consensus price forecast of $346.79, with recent target raises from Mizuho and Stifel to $415.