Cyber attacks have been on the rise due to growing digitization, the continued transition to the cloud, and the ongoing AI (artificial intelligence) wave. The increase in cybersecurity threats is expected to drive higher demand for the products offered by cybersecurity companies and boost their growth potential. Amid this backdrop, we used TipRanks’ Stock Comparison Tool to place Zscaler (ZS), CrowdStrike (CRWD), and CyberArk Software (CYBR) against each other to pick the cybersecurity stock with the highest upside potential, according to analysts.
Zscaler (NASDAQ:ZS)
Zscaler is considered a prominent player in the zero-trust cybersecurity space. ZS stock has declined 17% over the past year but has risen about 9% so far this year. The cloud-based cybersecurity company has been seeing solid demand for its Zero Trust Exchange platform and AI-enhanced solutions.
In December 2024, Zscaler reported better-than-expected Q1 FY25 results. However, the company’s Q2 FY25 outlook indicated further deceleration in revenue growth rate amid intense rivalry. Nonetheless, management is confident about boosting its business through its enhanced go-to-market plans and continued innovation.
Zscaler is scheduled to announce its results for the second quarter of Fiscal 2025 after the market closes on March 5. Wall Street expects the company to report earnings per share (EPS) of $0.69, indicating a 9% year-over-year decline. Revenue is expected to increase by about 21% to $634.4 million.
Is Zscaler a Buy, Sell, or Hold?
Heading into the Q2 FY25 results, Stifel analyst Adam Borg reaffirmed a Buy rating on Zscaler stock with a price target of $235. Given stronger mid-quarter checks, Stifel’s survey, and end-of-quarter checks, the analyst expects an upside to expectations. Borg thinks that investors will focus on the extent of upside in Q2 FY25 results and full-year outlook, given expectations of a “back-end loaded year” and sales productivity ramp.
Overall, Wall Street has a Strong Buy consensus rating on ZS stock based on 20 Buys and seven Hold ratings. The average Zscaler stock price target of $230.64 implies 17.5% upside potential.
CrowdStrike (NASDAQ:CRWD)
CrowdStrike stock has risen 21% over the past year, as the endpoint security expert delivered resilient performance despite the massive outage caused by a faulty software update by the company. In fact, the company delivered beat-and-raise Q3 FY25 results in November 2024.
To address customers’ concerns after the outage incident, CrowdStrike announced “customer commitment packages,” which include discounts and various incentives to win longer-term contracts. While this move is expected to weigh on the top line over the near term, it is expected to help in customer retention.
CrowdStrike is scheduled to announce its results for the fourth quarter of Fiscal 2025 on March 4. Analysts expect the company to report earnings per share (EPS) of $0.86, reflecting a 9% year-over-year decline. Meanwhile, revenue is expected to rise about 22% to $1.03 billion.
Is CrowdStrike a Buy or Sell?
Heading into the Q4 FY25 results, Rosenblatt analyst Catharine Trebnick increased the price target for CrowdStrike stock to $450 from $385 and reiterated a Buy rating. Based on the fieldwork by her firm, the analyst expects CrowdStrike to meet or modestly surpass its Q4 revenue estimate of 22% year-over-year growth.
Further, conversations with 20 chief information security officers in January and four resellers indicated that the impact of the outage appears limited, with minimal customer churn. In fact, Trebnick noted that customers are adding modules or extending the terms of their contracts.
Overall, Wall Street has a Strong Buy consensus rating on CrowdStrike stock based on 19 Buys and two Holds. At $438.24, the average CRWD stock price target implies about 12.5% upside potential from current levels.
CyberArk Software (NASDAQ:CYBR)
CyberArk is one of the prominent players in identity security. The company recently reported upbeat results for the fourth quarter of 2024, with ARR (annual recurring revenue) rising 30% on a year-over-year basis.
Additionally, CyberArk issued solid guidance, with the company’s performance expected to benefit from the acquisitions of Venafi and Zilla Security. The company expects 2025 revenue to grow in the range of 31% to 32%. CyberArk is also optimistic about its AI offering, CORA AI, which detects and responds to identity threats, enables better data-driven decisions, and secures both human and machine identities. The company sees CORA AI as a critical part of its growth strategy.
Is CYBR a Good Investment?
Following CyberArk’s Investor Day held on February 24, TD Cowen analyst Shaul Eyal reiterated a Buy rating on CYBR stock with a price target of $450. Eyal noted that the company now has a TAM (total addressable market) of $80 billion and is optimistic about achieving its long-term financial targets.
The analyst also highlighted the company’s initiatives to capture opportunities in machine identity through the Venafi acquisition and in Identity Governance and Administration (IGA) via Zilla acquisition, and enhance its go-to-market strategy through partner ecosystem enhancements. Moreover, CyberArk is working with Accenture (ACN) to address the potentially huge Agentic AI opportunity. Overall, management is targeting $2 billion in subscription revenue in 2028, up from $977 million in 2024.
Like Eyal, most analysts are optimistic about CyberArk Software stock. It scores a Strong Buy consensus rating based on 30 Buys versus one Hold recommendation. The average CYBR stock price target of $455.21 implies 25.1% upside potential.
Conclusion
Wall Street is highly bullish on CrowdStrike and CyberArk Software stocks but cautiously optimistic on Zscaler stock. Analysts see higher upside potential in CYBR stock than in the other two cybersecurity stocks. CyberArk Software is witnessing solid demand for its identity security solutions and AI-enhanced offerings, which are expected to drive robust business over the long term.