The 3 Most Undervalued Cybersecurity Stocks to Buy in June 2024

  • Here are some of the top cybersecurity stocks to buy and hold today.
  • Palo Alto Networks (PANW): Analysts at Argus just raised their price target on PANW to $348 with a buy rating.
  • Zscaler (ZS): It just unveiled multiple innovations to its AI Data Protection Platform that leverage the world’s largest security cloud and the power of AI.
  • CyberArk Software (CYBR): Baird analysts say “Recent conversations with channel partners of CyberArk indicated a ‘solid’ start to the second-quarter.
Undervalued cybersecurity stocks - The 3 Most Undervalued Cybersecurity Stocks to Buy in June 2024

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Cyberattacks are still wreaking global havoc. While it’s a royal pain, it is creating big opportunities for some of the most undervalued cybersecurity stocks.

All because governments, companies, cities, hospitals, consumers, and schools are still grossly unprepared for attacks. Most recently, an attack on a contractor to England’s National Health Service forced major hospitals in London to cancel operations, blood tests and appointments.

Ticketmaster was recently attacked, with hackers putting 500 million users’ information up for sale online. As noted by TechRadar.com:

“The database contained sensitive information on 560 million users, including payment data, but also containing people’s names, postal addresses, email addresses, phone numbers, ticket sales and event details, order information, and even partial payment card data, for sale. The partial payment card data includes cardholder names, the last four digits of the cards, expiration dates, and some customer fraud details.”

Until the cybersecurity threat diminishes, which is clearly not going to happen any time soon, you may want to invest in some of the top most undervalued cybersecurity stocks to buy.

Palo Alto Networks (PANW)

Palo Alto Networks (PANW) logo on corporate building
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Over the last few months, Palo Alto Networks (NASDAQ:PANW) ran from $265 to $320. Now back to $290, I’d again use weakness as an opportunity.

For one, recent earnings were solid. In its third quarter, EPS of $1.23 beat by seven cents. Revenue of $1.98 billion, up 15.1% year-over-year, beat by $10 million. 

Moving forward, the company expects fourth-quarter billings to range from $3.43 billion to $3.48 billion, which is a YOY growth range of 9% to 10%. It also expects to see total revenue of $2.15 billion to $2.17 billion, as compared to estimates of $2.16 billion. 

Two, analysts at Argus just raised their price target on PANW to $348 with a buy rating. The firm added that the “Cybersecurity environment is ‘getting more toxic’ as generative AI may be used for both good and ill, and Palo Alto continues to stand out from its sector peers with best-in-class technology and also a rapid product innovation cycle,” as noted by TheFly.com.

Zscaler (ZS)

Zscaler (ZS) logo on a corporate building
Source: Sundry Photography / Shutterstock.com

Another one of the most undervalued cybersecurity stocks to buy is Zscaler (NASDAQ:ZS), which slipped from a high of $251 to a low of $169.14. However, with negativity now priced in, I’d use the weakness as an opportunity to buy the stock.

First, it’s a leader in zero trust and cloud cybersecurity trading at less than growth. Second, it just unveiled multiple innovations to its “AI Data Protection Platform that leverage the world’s largest security cloud and the power of AI,” as noted by the company.

That includes its “‘Gen AI App Security’, which offers context-rich user and risk correlation, providing insights into risky prompts, AI app usage and granular policy controls,” says TechnologyMagazine.com. “This feature is crucial as the adoption of AI technologies continues to accelerate, presenting new security challenges.”

Recent earnings haven’t been too shabby either. In its third quarter, earnings per share of 88 cents beat estimates by 23 cents. Revenue of $553.2 million, up 32.1% YOY beat by $17.11 million. Moving forward, Zscaler forecasts revenue of $565 million to $567 million, exceeding estimates of $564.98 million for the fourth quarter.

CyberArk Software (CYBR)

Cyberark (CYBR) logo on a corporate building
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I’d also use weakness as an opportunity in CyberArk Software (NASDAQ:CYBR).

After failing at overhead resistance at $250, CYBR pulled back to $225, where it appears to have caught strong support. From here, I’d like to see it initially retest $250.

Helping, Baird analysts say “Recent conversations with channel partners of CyberArk indicated a ‘solid’ start to the second quarter, while the acquisition of Venafi created a ‘comprehensive’ machine-identity security platform with ‘significant’ go-to-market synergies.” The firm also has an outperform rating on the stock with a price target of $295.

Earnings have been solid here, too. In its first quarter, the company posted EPS of 75 cents, which beat by 48 cents. Revenue of $221.6 million – up 37% year over year – beat by $8.38 million. The subscription portion of its annual recurring revenue (ARR) jumped 54% to $621 million year over year. Even total ARR jumped 69% to $156.2 million.

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

Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.


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