Jim Cramer Is Focused on These 15 Stocks This Week

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

Cramer highlighted that Palo Alto Networks, Inc. (NASDAQ:PANW) stock often experiences a sell-off when it reports, which could present a buying opportunity.

“Then after the close Wednesday, we get big and then bigger. Palo Alto Networks and NVIDIA. Palo Alto’s had a gigantic move, just like all the cybersecurity stocks. The stock has sometimes sold off badly when it reports, could be an opportunity.”

Palo Alto (NASDAQ:PANW) is recognized as one of the largest cybersecurity companies globally, providing a wide array of security solutions designed to protect organizations from evolving digital threats. As reported in the final quarter of fiscal 2024, the company saw a significant increase in its annual recurring revenue from its next-generation security customers. Specifically, revenue from this segment surged by 43%, reaching $4.2 billion.

The company is optimistic about the continued growth of its next-generation security platform. The company projects that its annual recurring revenue from this segment will exceed $15 billion by 2030. This forecast is underpinned by the expectation that a substantial number of its top customers will adopt a platform approach to cybersecurity in the coming years. Specifically, the company anticipates that 3,500 of its top 5,000 customers will transition to using its integrated platform solutions.

On November 19, Jefferies raised the price target on Palo Alto (NASDAQ:PANW) to $450 from $400 and kept a Buy rating. The firm expects the company to report solid Q1 results, with a modest upside to its year-over-year RPO (Remaining Performance Obligations) guidance of 19%-20%.

However, the analyst notes that weaker network security trends and moderating survey results could limit the potential upside. While Jefferies does not foresee significant growth in RPO for FY25, it remains confident in the company’s long-term consolidation strategy and its ability to generate strong free cash flow over time.