For a stock that fell roughly 20% <\/strong>over the prior year, that swing matters to anyone holding it.<\/p>\n The new call gives investors something concrete to weigh before the company opens its books.<\/p>\n SOPA Images / Getty Images<\/p>\n<\/figcaption><\/figure>\n Morgan Stanley analysts Meta Marshall and Keith Weiss raised their price target on Palo Alto Networks to $253 from $223<\/strong> on May 20, keeping an Overweight rating, TipRanks reports.<\/p>\n That implies about 2% upside <\/strong>from the May 18 close, modest on its own but notable given how far the stock has already run.<\/p>\n The bank pointed to strong demand<\/strong> across firewall refreshes<\/strong>, Prisma SASE<\/strong>, Cortex XSIAM<\/strong> and AI security<\/strong> as the drivers.<\/p>\n A firewall refresh<\/strong> is the cycle where companies replace aging network security hardware, and that replacement wave is now feeding revenue.<\/p>\n More Tech Stocks:<\/strong><\/p>\n The firm based the new target on a higher 37x multiple<\/strong> of estimated 2027 free cash flow per share, up from 32x<\/strong>, a sign it now thinks investors will pay more for each dollar Palo Alto generates.<\/p>\n The upgrade is not random. Palo Alto Networks reports fiscal third-quarter results on June 2 after the market closes, and analysts are positioning ahead of it.<\/p>\n Morgan Stanley expects the company to beat consensus on remaining performance obligations, a measure of contracted future revenue that hints at demand the income statement has not yet recorded<\/strong>.<\/p>\n The bank sees RPO growing closer to 33% year over year<\/strong>, above the midpoint of management’s own guidance.<\/p>\n Related: Morgan Stanley resets Spotify stock price target<\/strong><\/p>\n It also expects product revenue to land well above the roughly 25% growth<\/strong> management guided to.<\/p>\n Two recent prints set the table: Fortinet<\/strong> grew product revenue 41% in its first quarter and lifted full-year guidance, per sec.gov, while Cisco<\/strong> beat on networking.<\/p>\n Such strong numbers from rivals<\/strong> often signal that the whole firewall market is healthy<\/strong>, which works in Palo Alto’s favor.<\/p>\n The bigger structural change<\/strong> sits in identity security, the work of controlling who and what can access a company’s systems.<\/p>\n That job is getting harder<\/strong> fast. <\/p>\n As AI agents start acting on their own inside companies, the number of things that need permission to log in and move data is exploding, and each one is a target.<\/p>\n Palo Alto is moving to own that problem. As announced in a Palo Alto press release, the company introduced Idira on May 12 <\/strong>as its next-generation identity platform<\/strong>, built to manage access for humans, machines, and AI agents.<\/p>\n The launch makes the company’s $25 billion CyberArk acquisition a built-in part of the platform instead of a separate, standalone product.<\/p>\n The thesis is that identity becomes a fourth pillar alongside network<\/strong>, cloud<\/strong>, and security<\/strong> operations, widening how much each customer can spend.<\/p>\n A higher target is not a guarantee<\/strong>, and the setup carries real risk.<\/p>\n The stock trades at a premium valuation, with a forward earnings multiple far above the market, so any growth wobble can hit the shares hard.<\/p>\n Palo Alto fell more than 5%<\/strong> after its last two earnings reports despite beating estimates, a reminder that a strong quarter does not always lift the stock.<\/p>\n Morgan Stanley also flagged possible pressure on hardware gross margins from rising memory costs, though it noted hardware makes up a smaller share of Palo Alto’s revenue than it does for competitors.<\/p>\n For the bull case to work, a few things need to land.<\/p>\n If management reiterates its full-year guides, as Morgan Stanley expects, the durable-demand argument gets stronger.<\/p>\n Context helps here. Palo Alto carries a market value near $176 billion<\/strong>, making it the largest pure-play cybersecurity name<\/strong>.<\/p>\n The stock’s roughly 78% climb off its 52-week low of $139.57 has far outpaced<\/strong> the S&P 500 over the same window, after touching a record high in mid-May.<\/p>\n However, Wall Street is not unanimous on price, even while broadly bullish. <\/p>\n Recent targets range widely.<\/p>\n Here’s where analysts stand ahead of earnings:<\/strong><\/p>\n That spread reflects a debate over valuation, not the company’s growth.<\/p>\n Morgan Stanley’s move to\u00a0$253<\/strong>\u00a0fits a wider pattern of analysts raising targets ahead of the June 2 report, driven by firewall demand, AI security traction, and a cleaner identity story following CyberArk.<\/p>\n The case<\/strong> rests on Palo Alto beating its RPO<\/strong> and product revenue guides while showing early Idira adoption.<\/p>\n The risk is a stretched valuation that has punished the stock even on good news.<\/p>\n Investors who already own PANW have a clear checklist for earnings day, and those waiting on the sidelines may want to see the quarter before paying near record prices.<\/p>\n Either way, the demand trends Morgan Stanley is betting on get tested in a matter of days.<\/p>\n Related: Ford stock hits the jackpot with latest move, Morgan Stanley says<\/strong><\/p>\n #Morgan #Stanley #resets #PANW #stock #price #target #demand #trends<\/p>\n","protected":false},"excerpt":{"rendered":" Palo Alto Networks (PANW) just picked up another vote of confidence from Wall Street, and it arrived at a busy moment for the stock. Shares closed at $247.55 on May… <\/p>\n","protected":false},"author":1,"featured_media":3599,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[246],"tags":[734,479,5887,100,481,480,91,1196,1417],"class_list":["post-3598","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-popular","tag-demand","tag-morgan","tag-panw","tag-price","tag-resets","tag-stanley","tag-stock","tag-target","tag-trends"],"_links":{"self":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/3598","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3598"}],"version-history":[{"count":0,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/3598\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/media\/3599"}],"wp:attachment":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3598"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3598"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3598"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![](\"https:\/\/www.thestreet.com\/.image\/NDA6MDAwMDAwMDAzMDUxNDk5\/photo-3051499.jpg?profile=rss\")
Morgan Stanley raises its PANW price target to $253 on firewall and AI security demand<\/h2>\n
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Why the timing of the Palo Alto Networks call points straight at June 2 earnings<\/h2>\n
How the Idira identity launch reshapes the Palo Alto Networks growth story<\/h2>\n
Morgan Stanley sees three reasons Idira matters:<\/strong><\/h3>\n
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What still has to go right for the $253 PANW target to hold<\/h2>\n
Here are four signals to watch on June 2:<\/strong><\/h3>\n
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How PANW stacks up against the broader market and its peers<\/h2>\n
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The takeaway for Palo Alto Networks investors<\/h2>\n