• 4Q26 revenue and PATMI met our expectations, with FY26 results at 101%/101% of our forecast. Revenue grew 34% YoY, underpinned by platformization and rising demand for AI-driven security solutions
• FY27e growth should remain supported by 1) platformisation and AI infrastructure buildout, with >65% of NGS ARR from platformised customers and >120% NRR supporting upsell and cross-sell, while rising AI capex drives more infrastructure to secure and traffic to inspect; and 2) AI security adoption through i) Prisma AIRS, ii) Cortex, and iii) CyberArk, as autonomous agents increase demand for governance, identity security and real-time cyber defence.
• We downgrade our recommendation to NEUTRAL from ACCUMULATE, with a higher DCF-based target price of US$346 (prev. US$320), following the recent share price performance. We roll our valuation forward while keeping our FY27e forecasts unchanged. Our terminal growth rate remains unchanged, while WACC rises to 5.2% due to a higher debt level and increased share count following recent acquisitions. PANW rallied ~160% from its February low to an August peak of US$396, driven by AI-related catalysts and easing software valuation concerns. We are bullish on PANW, supported by resilient cybersecurity spending, rising AI-driven threats, and strong demand for AI security. Its scale, platformisation strategy and M&A capacity position it well to capture long-term growth.

Overview BLOKS is a leader in China’s assembly character toys market. The company holds over 500 patents, possesses original IP capabilities, and has non-exclusive licenses for approximately 50 well-known IPs. Its product positioning is “high quality at a reasonable price.” Leveraging its product strength and supply chain advantages, BLOKS maintains cost competitiveness while continuously expanding its product categories. The company has established a multi-channel sales network, and since 2022, has primarily focused on offline channels centered on distributors. According to...
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Overview POP MART is primarily engaged in the design and development of trendy toys. It operates a comprehensive platform covering the entire industry chain of intellectual property (IP) for trendy toys, with businesses including IP incubation and operation, trendy toys and retail, theme park and experiences, and digital entertainment. The company’s products include blind boxes, figurines, ball-jointed dolls (BJD), MEGA, plush toys, and derivatives, among others. Its self-developed products primarily feature artist-owned IPs such as THE MONSTERS, MOLLY, SKULLPANDA, and...
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