PANW Is Down 20%: Should You Buy Palo Alto Networks Stock?
Should you buy Palo Alto Networks stock after a 20% drop? Its Maz Vantage Quant score is 4.12 (Strong Buy), but at 80x earnings we rate PANW a hold.
Maz Vantage Research ·
Key points
- Palo Alto Networks closed at $334.47 on Nov. 11, 2026, 20% below its 52-week closing high of $419.91 on Oct. 6.
- Its Maz Vantage Quant score is 4.12 out of 5 (Strong Buy), but its Valuation grade is a D at 1.02.
- The company reports fiscal first-quarter 2027 results after the market closes on Nov. 18, 2026.
Short answer: Should you buy Palo Alto Networks stock now? Not yet. We rate it a hold at $334.47. The business grows fast and turns about 38% of revenue into adjusted free cash flow. But the stock trades at about 80 times this fiscal year's expected earnings, and dilution from the CyberArk deal limits per-share growth.
The Palo Alto Networks stock price fell from a closing high of $419.91 on Oct. 6, 2026, to $334.47 on Nov. 11, 2026, as investors sold the software names that had gained the most this year. Even so, PANW stock is up 82% in 2026.
Why is PANW stock down 20%?
On Oct. 29, Fortinet fell about 20% after it cut its service revenue forecast, according to 24/7 Wall St., and the selling spread across cybersecurity stocks. Palo Alto Networks went from $394.49 on Oct. 28 to $365.87 on Oct. 30.
A second wave hit on Nov. 5, when AI-linked software stocks sold off. Yahoo Finance reported that the stocks that had gained the most this year fell hardest. Palo Alto Networks lost 9.6% that day, closing at $314.67. It closed at $313.84 on Nov. 6 and has since recovered 6.6%.
We found no company-specific bad news behind the fall. That day, TechCrunch reported that Palo Alto Networks was in talks to buy Clutch Security, an AI-agent security startup, for $500 million in cash.
What does Palo Alto Networks' Maz Vantage Quant score say?
Should you buy Palo Alto Networks stock? Maz Vantage Quant score: 4.12 of 5, Strong BuyThis content is hosted by datawrapper.dwcdn.net, which may set its own cookies. It is not loaded until you allow it.
Palo Alto Networks has a Maz Vantage Quant score of 4.12 out of 5, a Strong Buy, with Momentum strongest at 4.78 and Valuation weakest at 1.02. See the full breakdown in Palo Alto Networks' Maz Vantage ratings.
The score ranks Palo Alto Networks in the top 22% of 821 US technology stocks. Profitability (4.08) beats 77% of the sector. Momentum ranks in the top 6%, but these scores are as of Nov. 1, 2026, before the Nov. 5 drop, so that grade may weaken.
The Valuation grade is the warning. At 1.02, Palo Alto Networks ranks in the bottom 1% of its sector on price. The model likes the business more than the price.
How fast is Palo Alto Networks growing?
Palo Alto Networks earnings follow a fiscal year that ends July 31. In fiscal 2026, revenue grew 24% to $11.48 billion, helped by CyberArk, the identity-security company it bought during the year.
Palo Alto Networks quarterly revenue grew 34% to $3.41 billionThis content is hosted by datawrapper.dwcdn.net, which may set its own cookies. It is not loaded until you allow it.
Quarterly revenue rose from $2.14 billion in fiscal Q1 2025 to $3.41 billion in fiscal Q4 2026, up 34% from a year earlier.
| Quarter (fiscal) | Revenue | Growth vs. year earlier | GAAP EPS (diluted) |
|---|---|---|---|
| Q1 2026 (Oct. 2025) | $2.47 billion | 16% | $0.47 |
| Q2 2026 (Jan. 2026) | $2.59 billion | 15% | $0.60 |
| Q3 2026 (Apr. 2026) | $3.00 billion | 31% | -$0.28 |
| Q4 2026 (Jul. 2026) | $3.41 billion | 34% | -$0.35 |
Next-Generation Security annual recurring revenue (ARR, the yearly value of its subscription contracts in newer products) grew 63% to $9.10 billion. Remaining performance obligations, contracted revenue not yet recognised, grew 34% to $21.2 billion. CEO Nikesh Arora said AI is "elevating cybersecurity to the top of the CIO priority list."
Under GAAP, the official accounting rules, Palo Alto Networks lost $282 million in the fourth quarter, hit by deal costs, amortization and a change in the value of CyberArk's convertible notes. Adjusted (non-GAAP) earnings were $1.02 per share. Free cash flow, the cash left after capital spending, was $4.11 billion in fiscal 2026.
For fiscal 2027, management guided to revenue of $14.10 billion to $14.20 billion (up 23% to 24%) and adjusted EPS of $4.16 to $4.19. ARR growth is expected to slow to 22% to 23%.
Is Palo Alto Networks stock expensive?
Yes. Consensus estimates put fiscal 2027 adjusted EPS at $4.18, so Palo Alto Networks valuation sits at about 80 times forward earnings. The market value of $273.7 billion is about 24 times fiscal 2026 revenue.
| Company | Price (Nov. 11) | EPS estimate (fiscal year) | Forward P/E | Quant score |
|---|---|---|---|---|
| Palo Alto Networks | $334.47 | $4.18 (July 2027) | 80x | 4.12 |
| Fortinet | $128.10 | $3.56 (Dec. 2026) | 36x | 4.53 |
| CrowdStrike | $229.06 | $1.25 (Jan. 2027) | 183x | 4.78 |
Palo Alto Networks costs more than twice as much as Fortinet but far less than CrowdStrike. Of 89 analysts, 64 rate it a buy, 23 a hold and two a sell. The average price target of $400.05 implies 19.6% upside.
What are the biggest risks?
- Dilution. Fiscal 2027 guidance assumes 844 million to 847 million diluted shares, up from 709 million in fiscal 2025. Revenue is guided to grow 23% to 24%, but the consensus EPS of $4.18 is only 9% above fiscal 2026's $3.84.
- Slowing ARR growth. Guidance calls for ARR growth of 22% to 23% in fiscal 2027, down from 63%. At 80 times earnings, any miss will cost more than it would at a lower multiple.
- Deal risk. CyberArk raised goodwill from $4.57 billion to $22.01 billion in a year. A Clutch deal would be the fifth acquisition of 2026, PYMNTS reported.
Should you buy Palo Alto Networks stock right now?
Not yet. At $334.47, Palo Alto Networks is a high-quality business at a high price. The bull case is real: 24% revenue growth, an adjusted free cash flow margin of 38.4%, $7.9 billion in cash and investments against $1.77 billion of convertible notes, and a 4.12 Strong Buy quant score.
The bear case is the price. At 80 times forward earnings, with per-share growth of about 9% expected this fiscal year, the stock prices in years of strong execution.
Is PANW a good stock to buy for the long term? It suits patient growth investors who already own it. New buyers should wait for the Nov. 18 report. Income investors should look elsewhere; Palo Alto Networks pays no dividend. Read Palo Alto Networks' full Maz Vantage report for the full data, or compare it with other names in the Maz Vantage quant rankings.
What would change our view
- Nov. 18, 2026 earnings. Guidance calls for fiscal first-quarter revenue of $3.30 billion to $3.31 billion and adjusted EPS of $0.96 to $0.98. A beat with higher fiscal 2027 guidance would make us more positive.
- ARR. First-quarter ARR guidance is $9.54 billion to $9.56 billion. A miss would challenge the growth case.
- Price. A pullback toward 60 times forward earnings, about $250 on the $4.18 estimate, would make the risk-reward more attractive.
Palo Alto Networks stock: frequently asked questions
Is PANW a good stock to buy now?
We rate Palo Alto Networks a hold at $334.47 as of Nov. 11, 2026. It trades at about 80 times fiscal 2027 consensus earnings of $4.18 per share. Its Maz Vantage Quant score is 4.12 (Strong Buy), but its Valuation grade is a D. New buyers may want to wait for the Nov. 18 report.
What is Palo Alto Networks' Maz Vantage Quant score?
As of Nov. 1, 2026, Palo Alto Networks has a Maz Vantage Quant score of 4.12 out of 5, a Strong Buy. Its factor scores are Valuation 1.02, Growth 3.09, Profitability 4.08, Financial Health 3.22 and Momentum 4.78. That ranks it in the top 22% of 821 US technology stocks.
What is the analyst price target for Palo Alto Networks stock?
As of Nov. 12, 2026, the average analyst price target for Palo Alto Networks is $400.05, about 19.6% above the Nov. 11 close of $334.47. Targets range from $290 to $525. Of 89 analysts, 64 rate Palo Alto Networks a buy, 23 a hold and two a sell.
Why did Palo Alto Networks stock drop?
Palo Alto Networks stock fell 20% from its Oct. 6, 2026 closing high of $419.91 to $334.47 on Nov. 11. Cybersecurity stocks fell after Fortinet cut its service revenue forecast on Oct. 29. On Nov. 5, Palo Alto Networks lost 9.6% in a broad sell-off of AI-linked software stocks.
When does Palo Alto Networks report earnings next?
Palo Alto Networks reports fiscal first-quarter 2027 earnings after the US market closes on Wednesday, Nov. 18, 2026. The company guided to revenue of $3.30 billion to $3.31 billion and adjusted EPS of $0.96 to $0.98. The quarter ended Oct. 31, 2026.
Prices as of the 4:00 p.m. ET close, Nov. 11, 2026. Last updated Nov. 12, 2026.
Data: Maz Vantage's data, reported figures from Palo Alto Networks' filings, and consensus estimates.
This article is general research, not personal investment advice. It does not consider your goals, timeline or tax situation.
AI disclosure: written with the help of AI tools from market data and the sources listed.
Sources: Palo Alto Networks, fiscal fourth quarter and fiscal 2026 results (Form 8-K, Exhibit 99.1), Sept. 1, 2026; Palo Alto Networks, fiscal first quarter 2027 results date, Nov. 3, 2026; 24/7 Wall St., Fortinet tumbles 20% as service revenue forecast cut overshadows beat, Oct. 29, 2026; Yahoo Finance, Palantir and CrowdStrike stocks tumble as Wall Street dumps software's AI winners, Nov. 5, 2026; TechCrunch, Palo Alto Networks in talks to buy AI agent security startup Clutch for $500M, Nov. 5, 2026; PYMNTS, Palo Alto eyes $500 million purchase of Clutch Security, Nov. 5, 2026.