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Expect Robust Growth From These 3 Cybersecurity Leaders

Investors seeking robust growth in the second half of 2025 and beyond should consider the cybersecurity industry. Numerous tailwinds support it, including the increasing complexity of digital systems, the growing use of digitized resources, the deepening penetration of business services, and an exponential increase in the cost of cybersecurity attacks. 

Not only is the pace of cyberattacks increasing, but they are also becoming increasingly sophisticated, and their impact on businesses is growing. The cost of cybercrime is expected to increase significantly in 2025, surpassing the $10.5 trillion mark, providing a substantial incentive to protect digital assets globally and drive demand for cybersecurity stocks. 

Analysts at Wedbush recently highlighted the opportunity, stating AI tailwinds will aid the robust momentum exhibited in H1. The introduction of agentic AI only amplifies the outlook, increasing both the need to protect assets and the scale and scope of attacks.

On the one hand, businesses must protect the new resources from targeted attacks, while nefarious players also capitalize on these advancements. Their channel checks reveal increased spending across the cybersecurity industry, including module add-ons, and come with an optimistic long-term outlook.

In their view, the cybersecurity industry is well-positioned to benefit from an explosion of use cases linked to generative AI.

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Palo Alto Networks Is the Industry Leader

Palo Alto Networks (NASDAQ: PANW) is the cybersecurity industry leader in terms of revenue and market cap, commanding a small 1.2% of the highly fractured market. The company’s strategy in 2025 is platformization, which involves unifying its services into a more user-friendly system, and it is resonating with its clients. The company’s growth and profitability are exceeding estimates, sustaining a high-double-digit growth pace that is sufficient for Wedbush to rank it first on its list of picks. 

Other analysts see potential in Palo Alto Networks. Although some caution has crept into the data, trends reflect an overall bullish market, including steady coverage, a firm Moderate Buy rating, and an uptrending consensus price target. The consensus forecasts only 8% as of mid-July, but there are catalysts ahead to catalyze additional revisions. They include the FQ4 earnings release, due mid-August, in which another solid quarter and outperformance relative to consensus estimates are expected. 

Wedbush and Analysts Like Zscaler’s Z-Flex Program

Zscaler (NASDAQ: ZS) is another prominent growth stock that produces solid, double-digit growth and is capable of sustaining it in the long term. The FQ3 results revealed top and bottom strength, aided by the new Z-Flex program. It provides increased flexibility for its clients and is driving adoption and service penetration, capable of scaling along with them as they grow.

The analysts' trends leading up to the FQ4 report are bullish, including more than two dozen price target increases and several upgrades since the Q3 release. The trend extends into July, including a price target increase to $355 from JMP Securities. Their target aligns with the high-end range, forecasting a 20% to 30% upside at the high target of $385, and higher targets will likely be set. 

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CrowdStrike Highlighted as an H2 Winner

Wedbush also highlighted CrowdStrike (NASDAQ: CRWD) as an H2 winner. However, despite its strong business, the upside potential is limited. The stock price has already advanced significantly, accounting for a substantial portion of the anticipated growth. Wedbush’s $525 target aligns with the high-end range but offers only a low-single-digit upside, and other analysts are less enthusiastic.

The June and July activity includes numerous price target reductions and downgrades that are capping sentiment and price action. The market for this stock is expected to correct in Q3 2025, potentially pulling back by another 10% before reaching its bottom. 

Written by Thomas Hughes

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