Three Cybersecurity Stocks to Watch in July: Palo Alto Networks, CrowdStrike, and SentinelOne

Cybersecurity stocks are considered evergreen investments due to the rise of sophisticated cyberattacks. Three growing cybersecurity companies - Palo Alto Networks, CrowdStrike, and SentinelOne - are expected to expand at a CAGR of 12.9% from 2025 to 2030. Analysts expect Palo Alto's revenue to rise at a CAGR of 14% and adjusted EBITDA to grow at a CAGR of 17% from fiscal 2024 to 2027. CrowdStrike and SentinelOne are also expected to experience strong growth, with CrowdStrike serving over 29,000 customers and SentinelOne serving 1,459 larger customers in its latest quarter.

Cybersecurity stocks are often considered evergreen investments due to the rising sophistication of cyberattacks. As organizations increasingly recognize the need for robust digital defenses, the cybersecurity market is projected to expand at a compound annual growth rate (CAGR) of 12.9% from 2025 to 2030, according to Grand View Research. Three growing cybersecurity companies—Pal Alto Networks, CrowdStrike, and SentinelOne—are poised to capitalize on this growth. This article examines their unique approaches, growth prospects, and valuation metrics.

Palo Alto Networks (NASDAQ: PANW)

Palo Alto Networks is one of the world's largest cybersecurity companies, serving over 80,000 enterprise customers across three main platforms: Strata, Prisma, and Cortex. Its recent growth has been driven by Prisma and Cortex, collectively known as its "next generation security" (NGS) services. From fiscal 2024 to 2027, analysts expect Palo Alto's revenue to rise at a CAGR of 14% and its adjusted EBITDA to grow at a CAGR of 17%. This growth is anticipated to be driven by the consolidation of its network, cloud, and security tools into a unified AI-powered platform, the ongoing expansion of its NGS services, and future investments and acquisitions [1].

CrowdStrike (NASDAQ: CRWD)

CrowdStrike differentiates itself from its peers by offering its endpoint security tools exclusively as subscription-based cloud services. This cloud-native approach makes it stickier and easier to scale than traditional cybersecurity platforms. Its main platform, Falcon, allows customers to subscribe only to the modules they need. CrowdStrike serves more than 29,000 customers, including over half of the Fortune 1000 companies. From fiscal 2025 to 2028, analysts expect CrowdStrike's revenue to increase at a CAGR of 22% and its adjusted EBITDA to rise at a CAGR of 27%. The biggest catalysts for its near-term growth include Charlotte, its generative AI tool for streamlining threat detection, new AI-enhanced modules for Falcon, and Falcon Flex, a flexible subscription-based plan [1].

SentinelOne (NYSE: S)

SentinelOne is a smaller newcomer that uses AI algorithms to counter threats across its Singularity extended threat detection and response platform. Unlike Palo Alto Networks and CrowdStrike, which still rely on human analysts, SentinelOne aims to replace human analysts entirely with its AI algorithms. It served 1,459 larger customers (with over $100,000 in annual recurring revenue) in its latest quarter. From fiscal 2025 to 2028, analysts expect SentinelOne's revenue to grow at a CAGR of 20% and its adjusted EBITDA to turn positive this year. It is expected to continue gaining more federal contracts as it expands its higher-growth Purple AI, Cloud Security, and Hyperautomation modules [1].

Valuation Metrics

When evaluating these stocks, it is essential to consider their revenue growth rather than earnings, which can be volatile due to investments in expanding ecosystems. Palo Alto Networks trades at 12 times its projected sales for fiscal 2026, CrowdStrike trades at 25 times this year's sales, and SentinelOne looks the cheapest at less than 6 times this year's sales. Based on these valuations, CrowdStrike might be ideal for growth investors, SentinelOne for value-seeking contrarians, and Palo Alto Networks for a balanced play [1].

Conclusion

All three companies—Pal Alto Networks, CrowdStrike, and SentinelOne—offer promising growth prospects in the cybersecurity market. Despite the current market volatility, these stocks could generate substantial long-term gains for investors who focus on their long-term growth potential.

References

[1] https://finance.yahoo.com/news/3-top-cybersecurity-stocks-buy-114500243.html
[2] https://www.nasdaq.com/articles/3-top-cybersecurity-stocks-buy-july-0