Palo Alto Networks drops on zero-day security flaw concerns

Palo Alto Networks shares fell 4.2% in morning trading Friday as investors responded to a high-severity security vulnerability in the company's PAN-OS software that is actively being exploited.

The flaw, designated CVE-2026-0322, has a CVSS score of 8.6. It allows an authenticated attacker with network access to the PAN-OS management interface to execute arbitrary code with root privileges on affected firewalls.

The U.S. Cybersecurity and Infrastructure Security Agency added the vulnerability to its Known Exploited Vulnerabilities catalog and set October 17 as the remediation deadline for federal civilian agencies.

Phillip Securities downgraded the stock to Neutral from Buy on October 12, setting a price target of $346. The firm cited valuation concerns, noting the stock trades at approximately 97 times earnings compared to a five-year average near 54 times.

Citi raised its price target to $440 from $410 on October 15 and maintained a Buy rating. The firm pointed to improving cybersecurity spending trends driven by enterprise AI adoption.

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