This SentinelOne Analyst Cuts Forecast Ahead Of Q4; Projects Marginal Upside To ARR, Better Profitability

Shares of SentinelOne Inc (NYSE:S) were declining ahead of the company's fourth-quarter results due for release on Wednesday, March 12.

The company is likely to report its NNARR (net new annual recurring revenues) slightly higher than consensus estimates and provide "constructive" fiscal 2026 guidance, according to JPMorgan.

The SentinelOne Analyst: Analyst Brian Essex reaffirmed an Overweight rating, while reducing the price target from $33 to $27.

The SentinelOne Thesis: While there is some upside to ARR, the most material upside potential is for the company's profitability and free cash flows, Essex said in a note.

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While CrowdStrike Holdings Inc's (NASDAQ:CRWD) outage has added to SentinelOne's pipeline of deals, it has not driven actual results, he added.

The company has invested more in growth initiatives after approaching breakeven in profitability and cash flows, which could trigger an inflection to better NNARR growth in fical 2026, the analyst stated.

"We don't expect the same magnitude of margin expansion we've seen over the past few years, but the company's new CFO seems focused on balancing growth and profitability, and we see potential for operating and FCF margin upside with improvement of operating efficiency across the business in areas that don't necessarily effect growth," Essex wrote.

SentinelOne's stock underperforming peers year to date calls for the reduction in price target, Essex said.

S Price Action: Shares of SentinelOnehad declined by4.48% to $18.96 at the time of publication on Monday.

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