Cybersecurity stocks woke up on Monday as the group saw overall strength and several stocks hit new highs. The group is getting a boost from its artificial intelligence (AI) business and analyst price target lifts.
The computer software-security group moved up to No. 21 four weeks ago, from No. 42, out of the 197 industry groups that IBD tracks.
Cybersecurity Stocks Rally
Palo Alto Networks jumped 3.6% on Monday in lighter-than-average daily volume after Oppenheimer raised its price target to 290 from 250 and maintained its outperform rating on the stock.
The network and cloud security stock recovered from its 7% plunge Wednesday after Big Tech leader Microsoft announced its expansion into the network security arena. Palo Alto shares are above the 5% buy zone of a long, undefined base with a 213.63 buy point.
Palo Alto Networks posted accelerating quarterly EPS growth for five out of the last six quarters, with the two most recent quarters exceeding 80% growth. Sales growth has ranged from 24% to 30% in the last eight quarters.
Analysts expect full-year EPS to grow 42% this year and 22% in 2024. JPMorgan Chase upped its price target to 300 from 255 and kept its outperform rating on the stock.
Palo Alto holds the top spot in the computer software-security group.
Fortinet gained 1.7% and hit a record high on Monday. The move adds to its 4.3% jump on July 10, after Morgan Stanley raised its price target on the cybersecurity stock to 84 from 77.
The cybersecurity stock is above the buy zone of a flat base and a more recent three-weeks-tight pattern with a 71.29 entry. Fortinet provides software-as-a-service security software using website application firewalls and interfaces.
This Stock Hit A 52-Week High
Cybersecurity stock CrowdStrike Holdings rose 2.2% on Monday. Shares retook the 10-week moving average last week to give investors a new buy point of 153.93.
CRWD was the IBD Stock Of The Day on Monday.
CrowdStrike announced its new generative AI security analyst called Charlotte AI on May 30. The company has proved itself with continued robust quarterly earnings growth and sales numbers.
Zscaler soared 4.4% on Monday in light volume. The company's strong history of earnings growth earned it a best-possible 99 EPS Rating and stellar 98 Composite Rating.
Analysts project 137% full-year EPS growth in fiscal 2023 and 29% in 2024.
Zscaler provides cloud-based security architecture by connecting users, applications and devices in any location.
CyberArk rose 1.7% to a 52-week high on Monday. Shares hit the 165.18 buy point of a long base, in light volume.
The company has shown erratic quarterly earnings ranging from losses to profits. Analysts expect a full-year profit of 28 cents a share this year then a jump to $1.25 per share next year.
Other Cybersecurity-Related Stocks
Palantir added 6.1% after Mizuho raised its price target on the stock to 14 from 8. The stock has gained 171% this year so far as it benefits from its AI emphasis.
Internet security provider Cloudflare popped 6.1% to rise above the 5% buy zone of a double-bottom base with a 66.20 buy point.
Quarterly earnings grew to eight cents a share in its first quarter vs. one cent in the prior year's quarter. The company had its first profitable year in 2022 since going public in September 2019.
Analysts expect full-year EPS to grow to 34 cents this year, up from 13 cents in 2022, a resounding 163% increase.
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