Why Palo Alto Networks Stock Keeps Going Down

By Rich Smith – Apr 10, 2026 at 10:16AM ESTKey PointsAnthropic has a new cybersecurity-focused LLM called Claude Mythos.Investors are debating whether Mythos will grow the cybersecurity market or dominate it.Palo Alto Networks (PANW 7.45%) stock took its investors on a rollercoaster ride this week, surging Tuesday morning amid rumors of a collaboration between artificial intelligence giant Anthropic and cybersecurity companies such as Palo Alto -- then crashing yesterday on worries these rumors may prove false. Palo Alto continues to slide in Friday morning trading, down 7.1% as of 10 a.m. ET. Image source: Getty Images.

Will Claude Mythos save Palo Alto -- or kill it? Here's the basic story of what's happening, as retold by Benchmark analyst Yi Fu Lee: On Tuesday, April 7, Anthropic finally unveiled its Claude Mythos general-purpose language model, demonstrating the LLM's "significant capabilities in identifying security vulnerabilities" -- i.e., cybersecurity. Investors had been worrying about Mythos for weeks. But on the date of the reveal, the story changed to one of how Anthropic's Mythos could be good news for Palo Alto, by (1) highlighting the threat to cyber from AI-enabled hackers, at the same time as potential use of Mythos by companies like Palo Alto would expand demand for cybersecurity. ExpandNASDAQ: PANWPalo Alto NetworksToday's Change(-7.45%) $-12.44Current Price$154.55Key Data PointsMarket Cap$136BDay's Range$151.30 - $166.9952wk Range$139.57 - $223.61Volume424KAvg Vol11MGross Margin73.50% What it means for Palo Alto Networks Lee believes Mythos's arrival will grow the annual market for cybersecurity products by about $1 billion annually. Investors, both yesterday and today, seem less certain about that -- but honestly, nobody knows how this will play out. What we do know is this: Palo Alto already does nearly $10 billion in annual business, so a $1 billion-a-year bump in the total addressable market -- not all of which will go to Palo Alto -- won't be a world-changing event for Palo Alto, if it even happens. Meanwhile, Palo Alto stock's selling for about 100 times earnings, with annual earnings growth projected in the low teens. I see a whole lot more risk than reward in this one.Read NextApr 7, 2026 •By Lou Whiteman6 Best Defense ETFs to Buy in 2026Apr 4, 2026 •By Adam LevyThis CEO Just Put $10 Million of His Own Money Into His Company's Stock. Here's Why It's a Great Buy Right Now.Apr 2, 2026 •By Parkev Tatevosian, CFAI'm Upgrading Palo Alto Stock to a BuyMar 30, 2026 •By Rich SmithWhy Palo Alto Networks Stock Popped TodayMar 27, 2026 •By Rich SmithWhy Palo Alto Networks Stock Dropped TodayMar 26, 2026 •By Chris NeigerGot $1,000? The 1 Cybersecurity Stock I'd Buy While AI Anxiety Is Hammering the SectorAbout the AuthorRich Smith is a contributing Motley Fool defense and stock market analyst covering publicly traded and emerging companies in defense, space, aerospace, and other sectors. Prior to The Motley Fool, Rich practiced international corporate law for Clifford Chance in Russia, and for the Russian-Ukrainian Legal Group in Moscow, Kyiv, and Washington, D.C. He holds a bachelor’s degree in international relations from the College of William & Mary, a law degree from the University of Baltimore, and a language certification from the International Institute of Russian Language & Culture in Tver, Russian Federation. The Globe and Mail once featured him as “one of the best stock pickers since 2009.”TMFDittyX@RichSmithFoolStocks MentionedPalo Alto NetworksNASDAQ: PANW$154.33(-7.58%)-$12.66*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.