AlphaWire

newswire

Bank of America raises target prices for many cybersecurity stocks: The more powerful AI is, the higher the demand for cybersecurity

2026-07-29·newswire-us-stock-014014
Bank of America raises target prices for many cybersecurity stocks: The more powerful AI is, the higher the demand for cybersecurity.

On Sunday, Eastern Time, Bank of America’s latest report raised the target stock prices for multiple network security vendors Cloudflare, Palo Alto Networks, SentinelOne and CrowdStrike, citing the continued rise in valuations in the network security field, the accelerated popularity of artificial intelligence applications, and more optimistic long-term growth prospects.

Bank of America expects each of these companies to maintain revenue growth of about 20% or higher. They note that the widespread use of artificial intelligence is driving data volumes to surge, attack surfaces to continue to expand, and security systems to become more complex, underpinning continued spending needs across the industry.

Many cybersecurity stocks have their target prices raised Bank of America pointed out that leading cybersecurity platforms are expected to benefit from the growing market demand for protective services and the increasing value of their data, automation tools and artificial intelligence-based capabilities.

Analysts have upgraded these companies' EV/revenue multiples and EV/FCF multiples to reflect the above trends. Bank of America raised its price target on Cloudflare to $330 from $255 while maintaining a "buy" rating. The new target is based on a fiscal 2027 enterprise valuation of 33 times sales, up from 25 times previously.

Cloudflare's global network covers the fields of AI reasoning, application delivery, security and developer infrastructure. The strong growth momentum of developer services and artificial intelligence-related businesses also supports higher valuation levels. Palo Alto Networks remains a "buy" rating, with a price target raised to $420 from $330.

The new valuation gives a multiple of 19 times based on calendar year 2027 sales, up from 15 times previously. Platform integration will benefit the development of the company's network, cloud services and security operations businesses.

The continued expansion of automation and artificial intelligence capabilities is also expected to increase their share of enterprise security budgets. SentinelOne's price target was raised to $22 from $20.

Bank of America said its Singularity platform provides autonomous threat detection and artificial intelligence-based workflows, but due to its smaller scale and lower profit margins, it can still have a valuation discount relative to its larger competitors. CrowdStrike's stock price rose from $187.50 to $230, but its stock rating remains neutral.

Leadership in endpoints, cloud, identity and security operations underpin its growth prospects, although these advantages are reflected in higher valuation levels. Bank of America's revised target relies in part on continued expansion in industry valuations.

Slowing cybersecurity product adoption, sluggish customer growth, intensifying competition or a general decline in investor interest in highly valued software companies remain major risk factors.

#Stocks #EVs #AI #Earnings

Full text

Bank of America raises target prices for many cybersecurity stocks: The more powerful AI is, the higher the demand for cybersecurity

[Bank of America raises target prices for many cybersecurity stocks: The more powerful AI is, the higher the demand for cybersecurity] On Sunday, Eastern Time, Bank of America’s latest report raised the target stock prices for multiple cybersecurity vendors Cloudflare, Palo Alto Networks, SentinelOne, and CrowdStrike, citing the continued rise in valuations in the cybersecurity field, the accelerated popularity of artificial intelligence applications, and more optimistic long-term growth prospects.

On Sunday, Eastern Time, Bank of America’s latest report raised the target stock prices for multiple network security vendors Cloudflare, Palo Alto Networks, SentinelOne and CrowdStrike, citing the continued rise in valuations in the network security field, the accelerated popularity of artificial intelligence applications, and more optimistic long-term growth prospects. Bank of America expects each of these companies to maintain revenue growth of about 20% or higher. They note that the widespread use of artificial intelligence is driving data volumes to surge, attack surfaces to continue to expand, and security systems to become more complex, underpinning continued spending needs across the industry. Many cybersecurity stocks have their target prices raised Bank of America pointed out that leading cybersecurity platforms are expected to benefit from the growing market demand for protective services and the increasing value of their data, automation tools and artificial intelligence-based capabilities. Analysts have upgraded these companies' EV/revenue multiples and EV/FCF multiples to reflect the above trends. Bank of America raised its price target on Cloudflare to $330 from $255 while maintaining a "buy" rating. The new target is based on a fiscal 2027 enterprise valuation of 33 times sales, up from 25 times previously. Cloudflare's global network covers the fields of AI reasoning, application delivery, security and developer infrastructure. The strong growth momentum of developer services and artificial intelligence-related businesses also supports higher valuation levels. Palo Alto Networks remains a "buy" rating, with a price target raised to $420 from $330. The new valuation gives a multiple of 19 times based on calendar year 2027 sales, up from 15 times previously. Platform integration will benefit the development of the company's network, cloud services and security operations businesses. The continued expansion of automation and artificial intelligence capabilities is also expected to increase their share of enterprise security budgets. SentinelOne's price target was raised to $22 from $20. Bank of America said its Singularity platform provides autonomous threat detection and artificial intelligence-based workflows, but due to its smaller scale and lower profit margins, it can still have a valuation discount relative to its larger competitors. CrowdStrike's stock price rose from $187.50 to $230, but its stock rating remains neutral. Leadership in endpoints, cloud, identity and security operations underpin its growth prospects, although these advantages are reflected in higher valuation levels. Bank of America's revised target relies in part on continued expansion in industry valuations. Slowing cybersecurity product adoption, sluggish customer growth, intensifying competition or a general decline in investor interest in highly valued software companies remain major risk factors.

← Back to archive