Zacks Thematic Screens lets you dive into 30 dynamic investment themes shaping the future. Whether you're interested in cutting-edge technology, renewable energy, or healthcare innovations, our themes help you invest in ideas that matter to you.
For those interested in viewing the Thematic lists, please click here >>> Thematic Screens – Zacks Investment Research.
Let’s take a closer look at the ‘Cybersecurity’ theme and analyze a few stocks that the screen returned, such as Palo Alto Networks PANW, CyberArk Software CYBR, and Fortinet FTNT.
Cybersecurity
Cybersecurity encompasses comprehensive security measures designed to protect systems, networks, and programs from digital attacks.
These attacks often aim to access, alter, or destroy sensitive information, extort money from users through ransomware, or disrupt the integrity of normal business operations.
The widespread adoption of AI, IoT devices, and increased digitization across both public and private sectors has heightened vulnerabilities and expanded attack surfaces, necessitating the development of advanced security solutions.
This theme focuses on companies that offer integrated protection against evolving security threats while simplifying IT security infrastructure.
For those interested in viewing the Cybersecurity Thematic list, please click here >>> Thematic Screens – Cybersecurity.
With that in mind, let’s take a closer look at a few top stocks.
Palo Alto Sees Robust Demand
Palo Alto Networks, a current Zacks Rank #2 (Buy), offers network security solutions to enterprises, service providers, and government entities worldwide. The company’s sales growth has been robust, posting double-digit percentage year-over-year growth rates in ten consecutive periods.
Zacks Investment Research
Image Source: Zacks Investment Research
The company’s profitability has also seen a nice tick higher amid margin expansion, as we can see illustrated in the chart below that’s on a trailing twelve-month basis. Cash-generating abilities have also seen an increase, adding another highlight to the company’s robust results.
Zacks Investment Research
Image Source: Zacks Investment Research
And the company continues to enjoy robust demand, with its remaining performance obligation (RPO) growing 20% year-over-year to $12.7 billion throughout its above-mentioned period. Valuation multiples are steep, with the current 58.6X forward 12-month earnings multiple reflective of investors’ big growth expectations.
Consensus expectations for its current fiscal year suggest 10% EPS growth paired with a 14% sales increase.
CYBR Reports Record Sales
CyberArk, a current Zacks Rank #1 (Strong Buy), is a global leader in identity security. The company provides the most comprehensive security offering for any identity across business applications, distributed workforces, hybrid cloud environments, and throughout the DevOps lifecycle.
The outlook for its current fiscal year has remained very bullish, with the $2.29 Zacks Consensus EPS estimate up more than 60% over the last year and suggesting a sizable 105% growth rate year-over-year. Sales growth is also forecasted to be strong, with the $940 million expected 25% higher than FY23.
Zacks Investment Research
Image Source: Zacks Investment Research
Shares saw a nice pop following its latest set of quarterly results, now trading at all-time highs. Stocks making new highs tend to make even higher highs, particularly when positive earnings estimate revisions roll in.
Concerning its latest print, CyberArk delivered record revenue and saw a profitability uptick, also outperforming its previous guidance across all metrics. Like PANW, the company is enjoying a snowball of demand, with Subscription revenue of $158.4 million nearly 50% higher than the year-ago figure.
The company raised its full-year guidance across the board following the print, explaining the positive share reaction post-earnings. The company’s growth trajectory is expected to continue nicely, as shown below.
Zacks Investment Research
Image Source: Zacks Investment Research
Fortinet Raises Outlook
Fortinet, a current Zacks Rank #1 (Strong Buy), is a global cybersecurity leader driving the convergence of networking and security. The earnings estimate revisions trend for its current fiscal year reflects positivity, with the $2.03 per share expected up 17% over the last year.
Zacks Investment Research
Image Source: Zacks Investment Research
No different than those above, FTNT is coming off a considerably hot quarterly release, with the company enjoying record operating margins and also raising its 2024 sales outlook. Billings and sales came in at the high end of guidance, with cash flow from operations also totaling $342 million.
Please note that the chart below tracks the company’s gross margin on a trailing twelve-month basis.
Zacks Investment Research
Image Source: Zacks Investment Research
Bottom Line
Zacks Thematic Screens lets you dive into 30 dynamic investment themes shaping the future. Whether you're interested in cutting-edge technology, renewable energy, or healthcare innovations, our themes help you invest in ideas that matter to you.
Upon running the Zacks Cybersecurity Thematic screen, all three stocks above – Palo Alto Networks PANW, CyberArk Software CYBR, and Fortinet FTNT – were returned.
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