Palo Alto Networks, Inc.

(NASDAQ Global Select)
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Bullish +75

Why we're not discouraged by CrowdStrike and Broadcom selling. Context is everything

AI-generated analysis

๐Ÿ“‰ CrowdStrike, Broadcom, and Palo Alto Networks all experienced post-earnings declines despite reporting solid quarterly results and forward guidance.

๐Ÿ“ˆ Wall Street analysts largely increased price targets for the three companies, with Jim Cramer also maintaining a bullish stance on their fundamentals.

๐Ÿค– The recent stock sell-off is attributed to market momentum driven by "animal spirits" rather than deteriorating business conditions or earnings quality.

๐Ÿš€ Earlier in May, Snowflake's strong performance sparked an enterprise software rally that pushed CrowdStrike and Palo Alto Networks into overextended territory.

๐Ÿ’ป Broadcom's dip is linked to traders betting on a massive guidance raise from hardware partners Dell and HPE that ultimately did not materialize.

๐Ÿ›ก๏ธ AI is making cybersecurity companies more essential rather than threatening them, contradicting earlier narratives that AI would hurt the sector.

๐Ÿ“Š Palo Alto Networks shares are still up 9.3% since May 27, while CrowdStrike remains up 7.8% and Broadcom is down only 1.7%.

โš ๏ธ Jim Cramer advised investors to let Broadcom settle before buying, noting that he would be willing to buy the dip but not immediately.

๐Ÿ“‰ The stocks are currently facing a breather after being pushed too far, too fast by high expectations and market sentiment.

๐Ÿš€ A significant influx of supply from mega-IPOs like SpaceX, Anthropic, and OpenAI, plus Alphabet's fundraising, could lead to further selling pressure.

๐Ÿ”’ CrowdStrike and Palo Alto Networks were previously trimmed in April and May respectively, but Jim Cramer sees potential buying opportunities soon.

๐Ÿ“‰ These stocks remain up significantly on the year despite Thursday's price action, which is viewed as a temporary correction.

๐Ÿง  Long-term investors are encouraged not to be scared out of the market by near-term supply-driven declines.

๐Ÿ’ก The article emphasizes that fundamentals and businesses for all three companies remain strong despite the recent volatility.

๐Ÿ“‰ CrowdStrike and Palo Alto Networks were crushed earlier in the year on incorrect notions that AI would harm cybersecurity, a narrative Jim Cramer has debunked.

Bullish Signals
  • All three companiesโ€”CrowdStrike, Broadcom, and Palo Alto Networksโ€”reported solid quarterly results and forward guidance.
  • Wall Street analysts largely increased their price targets for CrowdStrike, Broadcom, and Palo Alto Networks following the earnings releases.
  • Palo Alto Networks shares are still up 9.3% since May 27, trading at $271 per share despite recent volatility.
  • CrowdStrike remains up 7.8% since May 27, with a share price of $695, reflecting strong long-term performance.
  • Jim Cramer remains bullish on all three stocks and stated he would be willing to buy the Broadcom dip once it settles.
  • The article emphasizes that CrowdStrike and Palo Alto Networks fundamentals remain strong, countering recent short-term price declines.
  • AI is making cybersecurity companies more essential than ever, validating the business models of CrowdStrike and Palo Alto Networks.
  • Broadcom benefits from expectations of increased orders related to Alphabet's $85 billion equity raise.
  • Jim Cramer's Charitable Trust maintains long positions in CRWD, PANW, and AVGO, signaling institutional confidence.
  • The recent price action is attributed to overextension rather than deteriorating fundamentals, presenting a potential buying opportunity.
Risk Factors
  • Palo Alto Networks (PANW) has experienced a three-session losing streak following its earnings report on Thursday, June 4, 2026.
  • The stock failed to meet the lofty expectations of an investor base chasing momentum similar to recent gains in Snowflake, Dell, and Hewlett Packard Enterprise.
  • Despite solid quarterly results and increased price targets from Wall Street analysts, PANW shares are down significantly from their record highs reached earlier in the week.
  • A significant influx of stock supply is expected from upcoming mega-IPOs like SpaceX, Anthropic, and OpenAI, as well as Alphabet's fundraising efforts, which could lead to further selling pressure.
Full Analysis
Palo Alto Networks (PANW), CrowdStrike (CRWD), and Broadcom (AVGO) experienced post-earnings declines on Thursday, June 4, 2026, following a three-session losing streak for Palo Alto Networks. Despite solid quarterly results and increased price targets from Wall Street analysts, the stocks failed to meet the lofty expectations of an investor base chasing momentum similar to recent gains in Snowflake, Dell, and Hewlett Packard Enterprise. Jim Cramer noted that while CrowdStrike and Broadcom were down, Palo Alto was still up 9.3% since May 27, with CrowdStrike up 7.8%, though Broadcom had given back some of its recent rally after traders piled in expecting a massive guidance raise from Alphabet that did not materialize. The article argues that these price drops are driven by market "animal spirits" and overextension rather than deteriorating fundamentals, as AI is making cybersecurity companies more essential than ever. Cramer advised investors to let Broadcom settle before buying and suggested CrowdStrike might be a buy in the coming days, while noting that Palo Alto Networks was last trimmed in May. The broader context includes a warning about significant stock supply from upcoming mega-IPOs like SpaceX, Anthropic, and OpenAI, as well as Alphabet's fundraising efforts, which could lead to further selling pressure but should not scare long-term investors out of the market.