Palo Alto Networks stock forecast
The weighted scenario puts Palo Alto Networks at $230.62 in October 2027. It hinges on cash growth after stock pay.
Where could Palo Alto Networks' shares be by October 2029?
The weighted price is $230.62 in October 2027, a 45% loss with dividends. It is $251.18 in October 2028, a 40% loss. By October 2029, it reaches $280.57, still a 33% loss. The October 2029 scenarios run from $88.34 to $548.25. Today’s price is $418.78.
| Case | Probability | October 2027 | October 2028 | October 2029 |
|---|---|---|---|---|
| Bear | 30 % | 118.87 (-72 %) | 86.80 (-79 %) | 88.34 (-79 %) |
| Base | 50 % | 242.71 (-42 %) | 265.83 (-37 %) | 288.83 (-31 %) |
| Bull | 20 % | 368.00 (-12 %) | 461.13 (+10 %) | 548.25 (+31 %) |
| Weighted | 100 % | 230.62 (-45 %) | 251.18 (-40 %) | 280.57 (-33 %) |
What has to go right, and what could go wrong for Palo Alto Networks?
The bear case falls to $2,400M first and then $2,200M. It recovers to $2,700M. Delayed deployments, a fading Chronosphere migration and the acquired businesses’ combined $797M operating loss support that downside. The bull case reaches $3,600M first, then $4,700M and $5,900M, requiring broad paid deployments and better service economics.
How much cash does Palo Alto Networks really make?
Cash from operations rose from $1,984.7 million to $4,553 million. After capital spending, free cash flow—cash left after maintaining or expanding the business—was $4,113 million. Its margin nevertheless fell from 37.6% to 35.8%, and working capital contributed less than in the prior year.
Stock compensation is also a shareholder cost. PANW recorded $1.815 billion of it in FY2026. Employees receive ownership claims instead of cash, so existing shareholders own a smaller proportion of a larger share count. Deducting that cost produces an analytical “real free cash flow” rather than an official accounting measure.
| Jul 2026 | Jul 2025 | Jul 2024 | Jul 2023 | Jul 2022 | |
|---|---|---|---|---|---|
| Cash from operations | 4,553 | 3,716 | 3,258 | 2,777.5 | 1,984.7 |
| − Capital spending | 440 | 247 | 157 | 146.3 | 192.8 |
| = Free cash flow | 4,113 | 3,469 | 3,101 | 2,631.2 | 1,791.9 |
| − Stock pay | 1,774 | 1,295 | 1,076 | 1,074.5 | 1,011.1 |
| = Real free cash flow | 2,339 | 2,174 | 2,025 | 1,556.7 | 780.8 |
| Real free cash flow, % of revenue | 20.4% | 23.6% | 25.2% | 22.6% | 14.2% |
What does an investor pay today for Palo Alto Networks?
The trailing P/E of 821.1x divides the share price by very small recent GAAP earnings. GAAP includes compensation, acquisition costs, taxes and unusual items; adjusted earnings remove selected items to show management’s preferred view of ongoing operations. PANW reported $3.84 of adjusted diluted earnings for FY26, while the forward P/E of 86.1x depends on forecast earnings arriving as expected.
| Today (Oct 12, 2026) | |
|---|---|
| Share price | 418.78 |
| Enterprise value (calculated) | 341,265.04 |
| P/E, last 12 months (calculated) | 821.1x |
| P/E, next 12 months (calculated) | 86.1x |
| Free cash flow yield (calculated) | 1.2% |
| Real free cash flow yield (calculated) | 0.7% |