After collecting feedback from 41 resellers/distributors located in the U.S. and Europe, Piper Jaffray says Palo Alto Networks (PANW) and FireEye (FEYE) remain as its top two favorite ideas in the security space. Palo Alto had the strongest results of all vendors in Q1, with 54% of resellers above plan, Piper notes, while adding FireEye had solid Q1 results. The firm says Barracuda Networks (CUDA) and CyberArk (CYBR) experienced improved reseller demand in Q1 based on its survey, while Symantec (SYMC) and Proofpoint (PFPT) experienced declines.

KeyBanc lowered the firm's price target on Palo Alto Networks to $355 from $380 on lower peer multiples, while keeping an Overweight rating on the shares. The firm says that at some point, the case for optimism needs to be backed up by some optimistic data, and its 1Q24 VAR Survey did not deliver it. IT budgets are still in hiding at this point, with just 50% of KeyBanc's respondents meeting or exceeding their goal in the Q1, the lowest quarterly reading since the heart of the pandemic, and sentiment from the follow-up calls with some individuals also has down ticked. The firm's Q4 2023 VAR survey was iffy, the outlook in 2024 from its CIO survey in January was also not great, its SMB survey was worse than expected, and now 2024 is off to a difficult start - "let's just call a trend a trend," KeyBanc adds.