As artificial intelligence (AI) continues to dominate headlines in the technology sector, the rising tide of cybersecurity spending deserves equal attention.
With digital transformation accelerating and cyberattacks on the rise, global cybersecurity spending is projected to reach $292 billion by 2028, according to Gartner. Against this backdrop, Finbold has analyzed current trends to identify two top stocks poised to capitalize on this expanding market and deliver long-term value to investors.
Palo Alto Networks (NASDAQ: PANW) stock
Palo Alto Networks (NASDAQ: PANW), with a market capitalization of $126 billion, has emerged as a key player in the global cybersecurity industry amid an escalating wave of cyber threats. The company estimated that there were approximately 2.3 million new threats every day when it announced the integration of AI into its systems.
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Over the years, Palo Alto has broadened its offerings to include cloud security solutions like Prisma Cloud and SASE, as well as threat detection tools such as Cortex XSOAR, which are widely used by enterprises around the world.
Moreover, the company recently launched its Quantum Random Number Generator (QRNG) Open API framework, designed to protect systems against quantum security risks.Its recent $100 million contract with the U.K. Home Office strengthens its growing influence in the market, as demand for robust cybersecurity measures continues to expand globally.
In its fiscal Q1 2025 results, the company reported a 14% year-over-year increase in revenue to $2.1 billion, driven by a 16.3% surge in subscription and support revenue and 3.7% growth in product sales.
Looking ahead, Palo Alto projects 14% revenue growth for fiscal 2025, with estimates ranging from $9.12 billion to $9.17 billion, and earnings expected between $6.26 and $6.39 per share.
At the press time, the shares are trading at $193, reflecting a 3.5% gain over the past five days and a 7% increase year-to-date.
While trading at a premium valuation of 59 times forward earnings, according to StockAnalysis, its strong growth trajectory justifies investor enthusiasm. Analysts remain bullish, with Morgan Stanley setting a price target of $230 and Scotiabank at $225, positioning Palo Alto as a strong candidate for long-term investment.
CrowdStrike (NASDAQ: CRWD) stock
CrowdStrike (NASDAQ: CRWD) stood out amid market volatility, emerging as one of the least affected stocks during the DeepSeek sell-off. Its Falcon platform, recently recognized as the ‘gold standard’ for ransomware protection, achieved 100% detection, protection, and accuracy in SE Labs’ 2024 Enterprise Advanced Security Ransomware Test, earning the AAA Award for the third consecutive year.
Moreover, partnerships with Commvault and Cognizant further highlight CrowdStrike’s growing influence in enterprise cybersecurity.
In the most recent quarter, the company reported a 28% year-over-year increase in revenue, reaching $1 billion, while annual recurring revenue (ARR) surpassed $4 billion. CrowdStrike’s ability to deepen engagement with its customer base remains a key driver of growth, with two-thirds of customers using five or more software modules and 20% adopting eight or more.
At the press time, CrowdStrike shares are trading at $401, reflecting a 6% gain over the past five days and a 19% increase year-to-date.
With bullish price targets, including Cantor Fitzgerald’s at $410, and a strong market presence, CrowdStrike remains a compelling option for long-term investors in the expanding cybersecurity sector.
Both companies are well-positioned to capitalize on the growing urgency for advanced cybersecurity solutions, presenting strong opportunities for long-term investors.
Featured image via Shutterstock
