Palo Alto Networks joins Tel Aviv’s flagship indices in major boost for Israeli market
The cybersecurity giant’s addition to the TA-35 and TA-125 is expected to trigger hundreds of millions of shekels in ETF buying demand.
Cybersecurity giant Palo Alto Networks will officially become part of the Tel Aviv Stock Exchange’s flagship equity indices on Thursday, joining the TA-35 and TA-125 at the close of trading.
The move marks the latest step in the company’s growing connection to Israel, where it employs thousands of employees and maintains a significant research and development presence. Palo Alto Networks said the secondary listing reflects its confidence in Israeli technology and its long-term commitment to the country’s cybersecurity ecosystem.
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Palo Alto Networks alongside the Tel Aviv Stock Exchange.
(Photos: Rina Castelnuovo/Bloomberg)
“Our mission at Palo Alto Networks is to be the natural partner in the field of cybersecurity and protect our digital lifestyle,” the company said. “Our secondary listing on the Tel Aviv Stock Exchange reflects our trust in Israeli talent and innovation, which are at the forefront of the world.”
The company’s shares trade on the Tel Aviv Stock Exchange under the ticker CYBR, while continuing to trade on Nasdaq under the ticker PANW.
The inclusion comes as Palo Alto prepares to become one of the most prominent foreign companies represented in Israel’s benchmark indices. The company is joining the indices through the exchange’s fast-track mechanism, which enables newly eligible companies among the 100 largest stocks in the Rimon database to be added outside the regular semiannual review process.
As part of the index update, Palo Alto is expected to generate significant buying activity from exchange-traded funds tracking the indices. The company’s initial weighting in both the TA-35 and TA-125 will be capped at 1.25%, before potentially rising to 2.5% in the November rebalance and 5% in February, subject to index rules.
The addition is expected to be a central component of one of the biggest trading events of the summer on the Tel Aviv Stock Exchange. During the quarterly rebalance, ETFs are expected to execute more than NIS 7 billion ($2.3 billion) in buy and sell orders as they adjust their holdings to reflect updated index weights.
Palo Alto Networks alone is expected to create approximately NIS 800 million ($262 million) in ETF demand, according to previous estimates.
Unlike the regular May and November reviews, the August rebalance does not typically change index composition. Instead, it adjusts weightings based on factors including free-float levels, stock tradability and the number of publicly available shares. Palo Alto’s addition is an exception because it enters through the fast-track process.
The company’s eventual weighting will be limited to 5% despite the TA-35’s maximum individual stock cap of 7%. The restriction is designed to ensure that the combined weighting of companies with U.S. ISINs, currently Palo Alto Networks and Ormat, remains below 10%, a threshold intended to avoid potential U.S. regulatory issues. With Ormat currently accounting for roughly 3% of the index, the combined exposure is expected to remain around 8%.
The company said its inclusion in the TASE indices reinforces its relationship with Israel.
“As an organization that employs thousands of excellent professionals in Israel, we are proud to be part of the local technology ecosystem,” Palo Alto Networks said. “This milestone reinforces our long-term commitment to continue investing in Israel, expanding our presence here and deepening our partnership with the Israeli innovation community.”
