2023 was a record year for ransomware attacks, with companies like MGM Resorts International (NYSE:MGM) suffering largely publicized attacks. Despite the efforts of companies and regulators, this trend isn’t slowing in 2024. The only defense will be more investments in cybersecurity, which will benefit top cybersecurity stocks.

Although regulators are trying to crack down on ransomware attacks, hackers keep launching more severe attacks. Companies themselves cannot afford any complacency due to the risk of losses. Furthermore, with the SEC disclosure regulations in effect, they must boost their cyber threats.

As the recent UnitedHealth (NYSE:UNH) ransomware attack showed, threat levels are still prevalent. Due to compliance requirements and mitigating monetary losses, Chief Information Security Officers are investing heavily in security.

Today, companies are prioritizing all cyber areas, from firewalls to endpoint security to access management. This means that more dollars will go to these top cybersecurity stocks that have the best security products.

Palo Alto Networks (PANW)

Palo Alto Networks (NASDAQ:PANW) has grown from a firewall company to one of the top cybersecurity stocks. Today, it’s a comprehensive cybersecurity platform that is a leader in over 21 cybersecurity categories.

It offers three main protection platforms: network security, cloud security and security operations. Each platform has several products with recognized industry leadership. For instance, under network security, it offers next-generation firewalls, Secure Access Service Edge (SASE), Security Services Edge (SSE) and six other products with category leadership.

Palo Alto offers a compelling case to enterprise customers who want to consolidate vendors. Moreover, its products are recognized for their leadership. For instance, Gartner has recognized Palo Alto as a leader in its Magic Quadrants in single-vendor SASE, endpoint protection platforms, security service edge, network firewalls and SD-WAN.

In February, PANW stock sold off after its earnings report due to its platformization efforts. That being said, it was another solid report, with revenues up 19% year-over-year to $1.98 billion. And despite a shift of strategy to accelerated platformization, management expects 15% to 16% revenue growth in FY2024.

Palo Alto Networks will continue to profit from cyber spending and benefit from vendor consolidation. Buy the stock on this bout of weakness.

CrowdStrike (CRWD)

Endpoint security has been one of the areas enterprises have focused on to prevent ransomware attacks. As one of the best endpoint platforms, CrowdStrike (NASDAQ:CRWD) is poised to profit from security investment dollars.

Over the years, industry research has rated CrowdStrike’s Falcon platform as one of the best security platforms. In 2023, Gartner named it a leader in endpoint security platforms among the sixteen vendors it evaluated. Its extended detection and response (XDR) platform was rated best for its ability to execute and completeness of vision.

Leveraging its leadership and cloud-native platform, CrowdStrike has maintained industry-leading growth rates while delivering impressive free cash flow. Full-year FY2024 revenues increased by 36% to $3.06 billion. Meanwhile, free cash flow increased from $676.8 million in fiscal 2023 to $938.2 million.

Moreover, the company expects a solid FY2025 as customers adopt more of its Falcon modules. It expects total revenue between $3.924 and $3.989 billion, translating to at least 28% growth. That’s why analysts are extremely bullish on CRWD stock.

Currently, CrowdStrike is a consensus buy among analysts with 38 buy and 7 overweight ratings. No analyst rates the stock a sell or underweight, making it one of the top cybersecurity stocks. Moreover, the average price target of $398 represents over 30% upside.

SentinelOne (S)

SentinelOne (NYSE:S) offers one of the highest revenue growth rates among top cybersecurity stocks. Its AI-powered security solutions have enjoyed strong demand from large enterprises and mid-market companies. As a result, FY2023 and FY2024 revenues grew by 106% and 47%, respectively.

Despite these impressive growth rates, investors have been slow to embrace the stock due to its poor profitability. However, management has stated it will focus on profitability and margin improvement in FY2025. I believe S stock has substantial upside, especially after it sold off on Q4 FY2024 results due to conservative guidance.

SentinelOne’s competitive position in endpoint security has allowed it to continue to win business. In Q4 FY2024, customers with annual recurring revenue of $100,000 or more grew 30% YOY to 1,133. Indeed, growth has never been an issue for SentinelOne; profitability has been the challenge.

Management has set a goal of achieving profitability by the end of FY2025. Q4 non-GAAP gross margins of 78% were in the long-term target range and management expects FY2025 margins between 77.5% and 78.5%. It will also deliver positive operating income and free cash flow by year-end.

SentinelOne’s revenue guidance of $812-818 million in FY2025 represents 30% growth. Reaching profitability will be an inflection point for this growth stock.

On the date of publication, Charles Munyi did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.