Cybersecurity is entering a critical new phase as artificial intelligence transforms how businesses operate — and how attackers exploit vulnerabilities. In a recent interview with CNBC, Palo Alto Networks CEO Nikesh Arora called this a “perfect time” for security companies, pointing to an inflection point in enterprise adoption of AI. “Even the naysayers are moving their data to the cloud,” Arora said, noting that tech giants are expected to spend over $300 billion on data centers this year — an investment wave that makes cybersecurity a central concern.
As AI agents begin taking on real operational autonomy — running manufacturing systems, customer service, and logistics — the threat landscape evolves rapidly. “Eventually, you’re going to have to give these agents true agency,” Arora warned, raising concerns that such systems could be hijacked if not properly secured. With AI and cloud infrastructure converging, cybersecurity is no longer optional — it’s foundational.
Even with economic headwinds and geopolitical uncertainty, Arora emphasized the strength of Palo Alto Networks’ results, calling them “phenomenal” under the circumstances. Against this backdrop, investors looking to gain exposure to this high-stakes sector may want to consider these 12 cybersecurity stocks poised to benefit from the AI revolution and the expanding need for digital defense.
Our Methodology
To compile the list of 12 best cybersecurity stocks to buy now, we reviewed cybersecurity ETFs to compile a preliminary list of stocks and then selected the ones with the highest upside potential based on Wall Street analysts’ average price targets. We have also mentioned the hedge fund sentiment around each stock, as of Q1 2025.
Note: All data was recorded on June 25, 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12 Best Cybersecurity Stocks to Buy Now
12. Fortinet, Inc. (NASDAQ:FTNT)
Upside Potential: 5.44%
Number of Hedge Fund Holders: 62
Fortinet, Inc. (NASDAQ:FTNT) is one of 12 best cybersecurity stocks to buy now. Fortinet, Inc. (NASDAQ:FTNT) has expanded its cloud security offering with the latest enhancements to its cloud-native application protection platform, FortiCNAPP, and has made the solution more widely available through the AWS Marketplace. The move aims to provide comprehensive code-to-cloud protection at a time when enterprises are increasingly relying on cloud infrastructure and demanding tighter integration between development and security operations.
Built on Lacework technology, FortiCNAPP offers visibility and protection from the earliest stages of application development through to deployment and runtime. The platform is designed to identify vulnerabilities in code, misconfigurations in cloud settings, compromised credentials, and active threats, while minimizing the volume of alerts that typically overwhelm security teams. By correlating findings across different stages of the application lifecycle, FortiCNAPP helps organizations prioritize and respond to the most serious risks.
Customers using FortiCNAPP are already seeing tangible results. LawnStarter, a company operating in a cloud-native environment, reported a 75 percent drop in compliance violations after deploying the platform. They credit the tool with improving access control, identifying configuration issues, and securing sensitive data within their AWS systems. With its inclusion in the AWS Marketplace, FortiCNAPP is now easier to deploy and integrates directly with services like Amazon Inspector, GuardDuty, and Security Hub. These updates reinforce Fortinet’s commitment to delivering integrated cloud security solutions that reduce complexity while enhancing protection across modern IT environments. The latest release positions Fortinet to meet growing demand for unified, scalable cloud security.
11. Extreme Networks, Inc. (NASDAQ:EXTR)
Upside Potential: 7.27%
Number of Hedge Fund Holders: 27
Extreme Networks, Inc. (NASDAQ:EXTR) is one of 12 best cybersecurity stocks to buy now. Rosenblatt Securities has raised its price target on Extreme Networks to $20 from the previous $18, while reiterating a Buy rating on the stock. The move reflects growing confidence in the company’s strategic direction and its execution across key networking segments. Extreme Networks, Inc. (NASDAQ:EXTR), a leading provider of cloud-driven networking solutions that includes embedded security features within its platforms, has been steadily gaining traction in both enterprise and service provider markets. Rosenblatt’s updated target suggests a belief that the company’s growth trajectory remains intact, supported by strong product demand and expanding customer adoption of its subscription-based offerings. Analysts at the firm noted that the ongoing transition to cloud-managed networking and the increasing need for secure, scalable connectivity are working in Extreme Networks’ favor.
Recent quarterly results showed resilience in a challenging macroeconomic environment, with the company demonstrating consistent revenue performance and improving operating margins. Extreme’s focus on high-margin software and cloud subscriptions appears to be gaining momentum, adding greater visibility to future earnings. Rosenblatt’s upward revision of the target price indicates expectations for continued outperformance relative to peers in the networking sector. With a refreshed product portfolio, the firm sees Extreme Networks, Inc. (NASDAQ:EXTR) well-positioned to capitalize on broader IT infrastructure modernization trends.
10. Datadog, Inc. (NASDAQ:DDOG)
Upside Potential: 8.75%
Number of Hedge Fund Holders: 84
Datadog, Inc. (NASDAQ:DDOG) is one of 12 best cybersecurity stocks to buy now. Bank of America analyst Koji Ikeda has raised the firm’s price target on Datadog, Inc. (NASDAQ:DDOG) to $150 from $138 while maintaining a Buy rating on the shares. The upgrade reflects growing confidence in Datadog’s long-term growth prospects, following encouraging insights from the company’s recent customer event and survey data.
Ikeda cited strong feedback from Datadog’s annual DASH conference, where enterprise adoption trends and product momentum were evident. The analyst noted that sentiment among customers remains positive, pointing to continued investment in observability and cloud infrastructure monitoring tools. These insights align with results from Bank of America’s proprietary Datadog survey, which highlighted a stable demand environment and increasing customer reliance on the platform’s expanded capabilities.
According to Ikeda, Datadog remains one of the most well-positioned vendors in the observability space, supported by durable top-line growth and strong free cash flow performance. He believes the company is on track to sustain more than 20% annual revenue growth and 20%-plus free cash flow margins over the long term, underpinned by its broad product portfolio and expanding enterprise footprint. With the increased price target, Bank of America reinforces Datadog, Inc. (NASDAQ:DDOG) as a “top pick” for the second half of 2025. The firm views Datadog’s continued innovation and customer traction as key drivers of upside in a competitive software landscape.
9. Varonis Systems, Inc. (NASDAQ:VRNS)
Upside Potential: 11.33%
Number of Hedge Fund Holders: 32
Varonis Systems, Inc. (NASDAQ:VRNS) is one of 12 best cybersecurity stocks to buy now. Varonis Systems, Inc. (NASDAQ:VRNS), a leader in data security and threat detection, has introduced the Varonis Model Context Protocol (MCP) Server, a new interface that allows customers to connect their preferred AI tools directly to the Varonis Data Security Platform. The innovation marks a significant step in enabling real-time, AI-driven access to enterprise data security operations.
With the MCP Server, customers can use natural language prompts through AI clients such as ChatGPT, Claude, and GitHub Copilot to query data posture, trigger remediation, and streamline compliance tasks. The server enables users to carry out complex operations with simple instructions—for example, retrieving recent high-severity alerts, updating ServiceNow tickets, or running cleanup scripts to remove inactive guest accounts.
“Automation is at the heart of everything we do,” said Yaki Faitelson, Co-Founder and CEO of Varonis. “The Varonis MCP Server marks another leap forward in our agentic AI vision—giving customers access to Varonis’ real-time data security insights and automated remediation from their own AI tools, IDEs, agent builders, and terminals.”
By embedding Athena AI in its platform and supporting cross-platform automation, Varonis continues to expand its role in modern data protection. The MCP Server furthers the company’s mission to deliver secure, intelligent infrastructure that helps organizations proactively defend sensitive information and reduce compliance burdens in complex cloud environments.
8. CyberArk Software Ltd. (NASDAQ:CYBR)
Upside Potential: 11.63%
Number of Hedge Fund Holders: 64
CyberArk Software Ltd. (NASDAQ:CYBR) is one of 12 best cybersecurity stocks to buy now. CyberArk Software Ltd. (NASDAQ:CYBR) received a vote of confidence from DA Davidson, as analyst Rudy Kessinger raised the firm’s price target on the cybersecurity firm to $465 from $435 while maintaining a Buy rating. The upward revision follows a group investor call hosted with CyberArk’s Chief Financial Officer, where management’s tone appeared upbeat despite the backdrop of a typically back-end loaded quarter.
Kessinger noted that with three weeks remaining in the current reporting period, CyberArk’s leadership did not indicate any signs of macroeconomic weakness impacting performance. According to his note to clients, the company appears to be executing well and remains on track with its financial and operational goals. The lack of caution from management was seen as particularly encouraging, given broader uncertainty in the software and cybersecurity sectors.
CyberArk Software Ltd. (NASDAQ:CYBR), known for its leadership in identity security and privileged access management, has continued to see strong demand for its solutions as enterprises invest in infrastructure to defend against increasingly sophisticated threats. The company’s transition to a subscription-based model has also gained traction, contributing to more predictable revenue growth and long-term customer relationships. DA Davidson’s revised price target reflects growing confidence in CyberArk’s market position and execution capabilities. Kessinger’s outlook reinforces the company as a top pick in cybersecurity, with fundamentals that appear well-aligned for continued strength heading into the second half of the year.
7. SailPoint, Inc. (NASDAQ:SAIL)
Upside Potential: 16.29%
Number of Hedge Fund Holders: 41
SailPoint, Inc.(NASDAQ:SAIL) is one of 12 best cybersecurity stocks to buy now. BMO Capital has raised its price target on SailPoint, Inc.(NASDAQ:SAIL) to $27 from $26, maintaining an Outperform rating following the company’s stronger-than-expected first-quarter results. The firm noted that SailPoint delivered upside across all key top-line metrics, reflecting solid execution and continued demand for its identity security solutions. Despite the beat, management raised its full-year 2026 annual recurring revenue (ARR) guidance by a slightly smaller margin than the quarterly outperformance. Still, BMO views the updated outlook as a sign of confidence and disciplined forecasting. The firm emphasized that SailPoint remains well-positioned to capture long-term growth, particularly as enterprises expand their digital environments and adopt more complex identity frameworks.
A growing area of interest, according to BMO, is SailPoint’s role in addressing security for machine identities and AI-driven agents—a trend expected to gain momentum in coming years. As businesses deploy artificial intelligence to automate processes, the need to secure non-human access points will become critical. SailPoint’s platform, which already supports complex identity governance at scale, is considered one of the few capable of meeting this evolving demand.
BMO’s upward price target revision reflects its view that SailPoint, Inc.(NASDAQ:SAIL) is emerging as a key player in the future of identity security. With strong fundamentals and a clear strategic roadmap, the firm believes SailPoint is well situated to benefit from increased enterprise focus on secure, intelligent access control.
6. A10 Networks, Inc. (NYSE:ATEN)
Upside Potential: 17.35%
Number of Hedge Fund Holders: 24
A10 Networks, Inc. (NYSE:ATEN) is one of 12 best cybersecurity stocks to buy now. A10 Networks, Inc. (NYSE:ATEN) has been selected by Microsoft to support the security infrastructure behind its mission-critical generative AI workloads, marking a significant milestone for the cybersecurity and application protection firm. Known for its high-performance DDoS mitigation solutions, A10 will provide advanced threat detection and mitigation tailored specifically for the scale and complexity of hyperscale AI environments.
The collaboration underscores the growing importance of robust, scalable security tools as cloud providers expand their AI capabilities. As enterprises and tech leaders race to deploy large-scale AI models, the underlying infrastructure must be fortified to handle not just immense data traffic, but also increasingly sophisticated threat vectors. “This opportunity reflects our commitment to supporting the buildout of the world’s most advanced AI platforms,” said Dhrupad Trivedi, board chair and CEO of A10 Networks. “We’re proud to contribute to an ecosystem that powers billions of secure, real-time transactions while driving future innovation.”
A10’s technologies are designed to operate in demanding environments, offering reliability and real-time protection across complex, distributed cloud networks. By aligning with Microsoft’s AI roadmap, A10 further strengthens its role in the evolving cloud security landscape, where performance and protection are both mission-critical. The engagement reaffirms A10 Networks’ position as a trusted partner in defending the infrastructure that underpins next-generation AI services.
5. Akamai Technologies, Inc. (NASDAQ:AKAM)
Upside Potential: 23.08%
Number of Hedge Fund Holders: 40
Akamai Technologies, Inc. (NASDAQ:AKAM) is one of 12 best cybersecurity stocks to buy now. KeyBanc Capital Markets has initiated coverage of Akamai Technologies, Inc. (NASDAQ:AKAM) with an Underweight rating and a price target of $63, signaling a cautious stance on the cloud and content delivery network provider. In a note to investors, the firm acknowledged that Akamai’s shares are not currently overvalued, but expressed concern over the potential for downside risks in the coming quarters.
The analyst noted that Akamai operates in an increasingly competitive environment, where pricing pressures and market saturation could weigh on growth. While the company remains a well-established player in edge computing and security, the firm believes the broader landscape lacks clear near-term catalysts that would drive meaningful upside for the stock. KeyBanc pointed to recent trends in the industry that suggest more potential for pricing disappointments rather than unexpected improvements. As demand patterns normalize following pandemic-era spikes, and as more players enter the space, maintaining premium pricing and defending market share may prove challenging for Akamai Technologies, Inc. (NASDAQ:AKAM) .
The initiation reflects a more conservative view on Akamai’s performance relative to peers in the infrastructure and cybersecurity segments. Despite ongoing investments in its cloud platform and security services, KeyBanc believes the company may face headwinds that limit valuation expansion in the near future. The firm recommends a cautious approach amid mixed industry signals.
4. Rubrik, Inc. (NYSE:RBRK)
Upside Potential: 23.22%
Number of Hedge Fund Holders: 45
Rubrik, Inc. (NYSE:RBRK) is one of 12 best cybersecurity stocks to buy now. CIBC analyst Todd Coupland has raised the price target on Rubrik, Inc. (NYSE:RBRK) to $125 from $110, maintaining an Outperformer rating on the stock. The decision follows the company’s first-quarter earnings report and its guidance for the second quarter and fiscal year 2026, which came in approximately 2% above FactSet estimates. Coupland highlights stronger-than-expected growth in subscription revenue, subscription annual recurring revenue (ARR) contribution margins, and free cash flow as key drivers behind the upgraded outlook.
Despite Rubrik’s relatively cautious guidance, CIBC views the results positively, citing continued momentum in the cybersecurity market. The firm notes that cyber resilience remains a critical focus for enterprises, which bodes well for Rubrik’s ongoing expansion. Additionally, the company has demonstrated steady gains in market share, reinforcing confidence in its competitive positioning. Coupland emphasizes that the combination of solid financial results and the heightened importance of cyber resilience supports the positive thesis on Rubrik. The analyst believes that the company is well-positioned to capitalize on growing demand for data protection and security solutions.
Based on these factors, CIBC considers Rubrik’s shares attractive and recommends buying the stock. The firm’s outlook reflects optimism about the company’s ability to sustain growth and profitability in a challenging but expanding cybersecurity market. Investors looking for exposure to this sector may find Rubrik a compelling opportunity.
3. Okta, Inc. (NASDAQ:OKTA)
Upside Potential: 27.44%
Number of Hedge Fund Holders: 65
Okta, Inc. (NASDAQ:OKTA) is one of 12 best cybersecurity stocks to buy now. Oppenheimer analyst Ittai Kidron has raised the firm’s price target on Okta, Inc. (NASDAQ:OKTA) to $135 from $125, maintaining an Outperform rating on the shares. The upgrade follows Okta’s strong fourth-quarter results and an upward revision to its guidance, driven by broad-based momentum across several key areas. According to Oppenheimer, the company saw solid trends among its large customers, contributing to robust growth. Notably, Okta recorded a record contribution from its Auth0 segment, further enhancing its revenue mix. Additionally, growing product cross-sell activity highlighted the company’s expanding product portfolio and customer engagement.
The analyst praised Okta’s overall execution during the quarter, calling it an “excellent quarter” that showcased the benefits of recent sales adjustments and the company’s increasing product breadth. These factors, combined with a favorable market environment, position Okta well for continued growth. Oppenheimer expressed a bullish outlook on Okta’s prospects, establishing the stock as a top pick within its coverage. The firm sees a potential multi-quarter re-rating driven by the company’s strong sales execution and expanding portfolio.
Investors may view Okta’s improving fundamentals and strategic progress as key reasons for confidence in the stock’s future performance. The updated price target reflects Oppenheimer’s belief that Okta is well-positioned to capitalize on its momentum and deliver sustained growth in the coming quarters.
2. SentinelOne, Inc. (NYSE:S)
Upside Potential: 29.02%
Number of Hedge Fund Holders: 44
SentinelOne, Inc. (NYSE:S) is one of 12 best cybersecurity stocks to buy now. Jefferies analyst Joseph Gallo has lowered the firm’s price target on SentinelOne, Inc. (NYSE:S) to $23 from $25, while maintaining a Buy rating on the shares. The adjustment reflects a broader reduction in price targets across Jefferies’ U.S. software coverage, prompted by recent multiple compression and early signs of softening macroeconomic conditions affecting deal-making in the technology sector.
Gallo pointed out that these factors could lead to what he describes as another “mullet” year for software companies, characterized by a challenging first half followed by a stronger second half. Despite this outlook, Jefferies has not yet lowered its earnings estimates for SentinelOne, choosing instead to await further data from upcoming first-quarter checks.
The analyst also noted that SentinelOne’s recent guidance assumed no significant improvement in market conditions, underscoring the cautious tone from management. As uncertainty continues, many investors appear to be holding back, adopting a wait-and-see approach to gauge how the evolving environment will affect technology spending and deal activity. While the cautious stance has led to a tempered near-term outlook, Jefferies remains positive on SentinelOne’s longer-term prospects, keeping a Buy rating on the stock.
1. Telos Corporation (NASDAQ:TLS)
Upside Potential: 37.99%
Number of Hedge Fund Holders: 10
Telos Corporation (NASDAQ:TLS) is one of 12 best cybersecurity stocks to buy now. Telos Corporation (NASDAQ:TLS) has announced a significant milestone, reaching 350 TSA PreCheck enrollment and renewal locations across the United States. This expansion strengthens Telos’ position as a key provider of trusted traveler services, helping to streamline security processes for millions of travelers. The TSA PreCheck program allows eligible travelers to experience expedited screening at airports, providing a faster and more convenient travel experience. Telos’ network of enrollment centers spans major cities and airports nationwide, making it easier for individuals to apply for or renew their TSA PreCheck status.
Telos Corporation (NASDAQ:TLS) has focused on expanding access to these services, aiming to reduce wait times and improve customer satisfaction. The increase to 350 locations reflects the company’s commitment to meeting growing demand and supporting the transportation security infrastructure. With this broad network, travelers benefit from more convenient locations and flexible appointment options. Telos also provides the technology and operational support needed to maintain a smooth and efficient enrollment process.
The growth in TSA PreCheck enrollment centers aligns with rising traveler volumes as air travel continues to recover. Telos remains dedicated to enhancing the security screening experience while ensuring compliance with federal guidelines. This development is expected to facilitate more seamless travel for both frequent flyers and occasional travelers, contributing to a safer and more efficient airport experience nationwide.
While we acknowledge the potential of TLS to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than TLS and that has 100x upside potential, check out our report about this cheapest AI stock.
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