The firm sees sustained revenue growth and improving free cash flow for the cybersecurity company into FY27.
TD Cowen reaffirmed its Buy rating and $19 price target on Netskope (NTSK) after meeting with management, citing “compelling” valuation at current levels. The firm expects annual recurring revenue (ARR) to accelerate through FY27 and free cash flow to improve in the latter half of next year, potentially shifting investor sentiment.
Recent analyst actions show mixed views. RBC Capital cut its price target to $13 from $14 on June 4, citing a 300 bps sequential ARR deceleration despite 29% year-over-year growth. Morgan Stanley also trimmed its target to $14 from $18, calling the stock a “show-me story” due to valuation concerns.
Netskope reported 29% ARR growth in its latest quarter, exceeding consensus, though sequential deceleration raised investor caution. The company’s focus on AI-driven cybersecurity remains a key growth driver.