F5 (FFIV) is positioned for a potentially extended growth cycle, driven by a "refresh plus" dynamic in its installed base as customers upgrade legacy systems while also expanding capacity for AI-driven and future workloads, reflecting a shift toward infrastructure expansion rather than simple replacement, RBC Capital Markets said in a Tuesday note.

The analysts said hybrid multi-cloud is a key driver of demand for F5's ADC platform, supported by data sovereignty, security and cost factors, while competitive displacement from legacy and cloud-native solutions is also boosting growth as enterprises pursue unified policy control across environments.

RBC noted F5 is in early AI monetization but is seeing traction in data delivery, runtime security and GPU load balancing, with initial revenue emerging and broader adoption expected as workloads move to edge and private cloud.

The firm said management expects product revenue to grow at a double-digit rate through fiscal 2029 and services revenue at a mid-single-digit CAGR, while RBC believes overall revenue growth could exceed the company's high-single-digit outlook amid security, AI, hybrid multi-cloud adoption and potential future demand tied to post-quantum cryptography.

RBC maintained its outperform rating on the stock and raised its price target to $450 from $425.

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