The company, which is slated to go public on Friday, had initially expected to sell 6.2 million shares in its IPO at $34 to $37 apiece.
At the top end of the revised range, the company has a market valuation of $2.66 billion.
If the company prices at $40 per share, the holdings of its two largest shareholders – Greylock Partners and Sequoia Capital – would be valued at more than $1.1 billion combined.
Greylock and Sequoia each own 13.79 million shares (or 22.3% of the total prior to the IPO) worth about $552 million at the $40 price, according to the company’s most recent SEC filing. Globespan Capital Partners owns 4.92 million shares (or 8%), which would be worth close to $200 million at the $40 share price.
Earlier in the day, retailer Five Below Inc. had also raised its expected price range.
A company raising its price range before the scheduled pricing indicates that underwriters feel the stock would see strong investor demand.
Palo Alto is widely expected to do well when it goes public later this week, and is the most anticipated market debut of the year after Facebook.
Technology offerings, which have seen high valuations and heavy investor demand this year, are back in the spotlight after the successful debut of IT software company ServiceNow last month.
Additional reporting for peHUB by Lawrence Aragon
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