Piper Sandler Turns Neutral on SentinelOne (S) Despite Modest Valuation

SentinelOne, Inc. (NYSE:S) is one of the AI Stocks on the Market's Radar. On January 5, Piper Sandler downgraded the stock to “Neutral” and reduced the price target on the stock to $17 from $20. The rating downgrade comes as part of its 2026 outlook for Security and Infrastructure Software stocks.

"2025 proved to be a tough year for our coverage, with the average name showing negative performance and only four names outperforming the NASDAQ (fewest in 5+ years). We are cautiously optimistic for a better year in 2026, with many names entering the year at interesting valuation levels setup well to be longer-term GenAI winners, despite monetization at the software layer not yet occurring at scale." -Analysts led by Rob Owens.

According to the firm, even though the current valuation of ~3x EV/CY'27E revenue appears extremely modest on the surface, factors such as recent management changes, an absence of near-term catalysts and disappointing recent results make the stock less compelling than others.

Piper Sandler does remain positive on Sentinel One’s technology platform, acknowledging that more could likely go right than can go wrong at the current valuation. However, with no impending catalyst to slow or reverse deceleration, the analysts have adjusted the rating to Neutral.

SentinelOne, Inc. (NYSE:S) is one of the leading artificial intelligence-powered cybersecurity providers.

While we acknowledge the potential of S as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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