On August 10, 2026, CrowdStrike Holdings, Inc. (NASDAQ:CRWD) and Palo Alto Networks, Inc. (NASDAQ:PANW) shares jumped more than 5% to new highs after the cybersecurity industry’s annual Black Hat conference in Las Vegas. Analysts at BTIG wrote that “AI agents have fundamentally changed the threat landscape.”
Why This Matters
AI is cutting both ways for cybersecurity buyers right now. AI agents have become the leading new attack method, but that same shift is also driving fresh demand for tools to defend against them.
That raises the question here: is this long-lasting growth that will continue for years, or just a short boost from event news that will fade once the attention disappears?
The Bull and Bear Case: CrowdStrike
BTIG said AI security deployment is still in the “early innings,” pointing to a long runway ahead. The firm raised its CrowdStrike Holdings, Inc. (NASDAQ:CRWD) price target to $237, about 11% above Friday’s close. BTIG argued AI is creating “a new modernization cycle” in endpoint security that directly benefits CrowdStrike’s core business. That builds on comments CrowdStrike CEO George Kurtz made in June, when he said Anthropic’s Mythos-related security initiative, Project Glasswing, drove “a deluge of customer, prospect and partner inquiries,” a sign this demand story predates just one good conference.
Back in June, investors priced CrowdStrike Holdings, Inc. (NASDAQ:CRWD) at almost 138 times its expected earnings for the coming year, which was roughly double Palo Alto Networks’ price, leaving no room for mistakes. Even after Kurtz’s bullish June commentary, the stock still fell 7% when quarterly forecasts missed steep investor expectations, following a run of nearly 90% since the prior earnings report. Some analysts said it was mainly caused by investors selling to lock in their profits.
The Bull and Bear Case: Palo Alto Networks
BTIG lifted its Palo Alto Networks, Inc. (NASDAQ:PANW) price target to $380, about 4% above Friday’s close. The firm cited the company’s identity platform as a beneficiary of the spread of AI agents and products like XSIAM as building a data advantage over rivals. Analysts at Cantor wrote that AI has become “a key pillar” of both the attack surface and the defense infrastructure businesses now rely on, widening Palo Alto’s opportunity well beyond one product line.
Monday’s price target implies less upside for Palo Alto than for CrowdStrike Holdings, Inc. (NASDAQ:CRWD), about 4% versus 11%. Moreover, Palo Alto Networks, Inc. (NASDAQ:PANW) shares also fell 3.3% back in June even as industry-wide AI security demand stayed strong, a reminder that a positive theme doesn’t guarantee gains if a specific quarter disappoints.
Insider Monkey’s Hedge Fund Data
CrowdStrike Holdings, Inc. (NASDAQ:CRWD) was held by 79 hedge funds as of Q1 2026, up from 67. Palo Alto Networks, Inc. (NASDAQ:PANW) had 87 holders, up from 86. For comparison, Zscaler had 46 holders, and SentinelOne had 37. It shows both larger names remain far more popular with hedge funds than smaller cybersecurity peers.
Conclusion
The Black Hat conference gave both stocks a strong boost, but CrowdStrike’s higher price tag means it will hurt more than Palo Alto if things go wrong.
Overall, hedge funds favor Palo Alto Networks, Inc. (NASDAQ:PANW) over CrowdStrike Holdings, Inc. (NASDAQ:CRWD).
While we acknowledge the risk and potential of CRWD as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CRWD and that has 10,000% upside potential, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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