Palo Alto Networks Inc. (NASDAQ: PANW ) stock surged about 3% Thursday as strong peer earnings fueled a broader cybersecurity rally. Bullish analyst sentiment also supported the stock ahead of the company’s Sept. 1 earnings report.
Nasdaq futures rose 0.82%, while S&P 500 futures gained 0.28%.
CrowdStrike Results Lift Cybersecurity Stocks
The rally followed strong fiscal second-quarter results from CrowdStrike Holdings Inc. (NASDAQ: CRWD ). The company released its results 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.
The 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.
TrendingThe 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 Sept. 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 Wednesday. JPMorgan raised its forecast to $384 from a previous level and kept an Overweight rating Tuesday. Benchmark lifted its forecast to $400 and maintained a Buy rating Monday.
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 Thursday, according to Benzinga Pro .
Photo via Shutterstock
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