10 Trending AI Stocks in Focus This Week

7. Palo Alto Networks, Inc. (NASDAQ:PANW)

Number of Hedge Fund Holders: 77

Palo Alto Networks, Inc. (NASDAQ:PANW) is one of the 10 Trending AI Stocks in Focus This Week. On August 18, Raymond James analyst Adam Tindle reiterated a Market Perform rating on the stock without a price target. The rating affirmation follows Palo Alto’s better-than-expected quarterly results and guidance.

The firm noted how revenue, RPO, and bookings metrics all outpaced expectations supported by several large multiyear deals. The only concern has been a modest beat on NGS ARR.

PANW’s forward guidance also exceeded growth and profitability expectations. However, the firm expects these trajectories to change after the CyberArk acquisition closes next calendar year.

“Services are implied to be flat/decel in FY26 as Product growth accelerates; while we believe these conflicting trends could be a sign of demand pull-in for industry participants, we view Palo’s Product line having a larger software constitution versus peers as a more attractive model for predictability. A new 40%+ adj. free cash flow margin in FY28 post CyberArk acquisition could imply ~$6B of FCF generation at modest growth rates (that could help offset some deal dilution), and we think the FCF multiple could be attractive relative to recent valuation (low/mid 20x P/FCF vs. high 20x 5-year average). We think we have some time to understand integration plans and collect more channel feedback, but admit that the plan post CYBR close looks attractive.”

Palo Alto Networks, Inc. (NASDAQ:PANW) is a leader in AI-powered cybersecurity.