Purported DoD deal could give Palo Alto multi-year tailwind, says Morgan Stanley

Morgan Stanley says “multiple online sources” indicated yesterday that a five-year, $1B contract value was awarded for the “provision of Palo Alto Networks (PANW) software subscriptions, hardware maintenance and services” through Federal distributor Carahsoft. While stating that it is unclear if this is related to DISA’s “Thunderdome” project awarded to Booz Allen Hamilton (BAH) and Palo Alto last year, which has yet to contribute financially, the firm thinks this contract award suggests that “the large but elusive DoD opportunity could finally be coming into fruition.” The firm, which adds that it thinks this could provide “multi-year tailwinds,” has an Overweight rating and $446 price target on Palo Alto shares.