Buy These 4 Cybersecurity Stocks, Skip These 2: Josh Brown Names Names
Ritholtz Wealth Management CEO Josh Brown and colleague Sean Russo used their latest “The Best Stocks in the Market” column at CNBC to stake out a clear position on security software: four names earn a spot, two do not. CrowdStrike Holdings, Inc. (NASDAQ: CRWD ), Palo Alto Networks, Inc. (NASDAQ: PANW ), Fortinet, Inc. (NASDAQ: FTNT ) and Cloudflare, Inc. (NYSE: NET ) made the list. Zscaler, Inc. (NASDAQ: ZS ) and SentinelOne, Inc. (NYSE: S ) did not. CRWD stock is moving. See the real-time price action here. CrowdStrike Leads the Group Brown called CrowdStrike “one of the cleanest charts in the sector.” Russo noted the stock is up 104% this year and has returned 58.8% since mid-May, against 13.8% for the iShares Expanded Tech-Software ETF (NASDAQ: IGV ) and 3.5% for the S&P 500. The fundamentals traveled with the tape. Second-quarter revenue rose 26% to $1.47 billion, net new annual recurring revenue hit a record $333 million, and ending ARR reached $5.84 billion. Falcon Flex now carries $2.29 billion in ARR, up 101%. Management lifted full-year net new ARR guidance to $1.35 billion at the midpoint. Read Also: These 10 Stocks Are Squeeze Candidates Waiting to Happen CrowdStrike sh
Ritholtz Wealth Management CEO Josh Brown and colleague Sean Russo used their latest “The Best Stocks in the Market” column at CNBC to stake out a clear position on security software: four names earn a spot, two do not. CrowdStrike Holdings, Inc. (NASDAQ: CRWD ), Palo Alto Networks, Inc. (NASDAQ: PANW ), Fortinet, Inc.
(NASDAQ: FTNT ) and Cloudflare, Inc. (NYSE: NET ) made the list. Zscaler, Inc. (NASDAQ: ZS ) and SentinelOne, Inc.
(NYSE: S ) did not. CRWD stock is moving. See the real-time price action here. 5% for the S&P 500.
The fundamentals traveled with the tape. 84 billion. 29 billion in ARR, up 101%. 35 billion at the midpoint.
Read Also: These 10 Stocks Are Squeeze Candidates Waiting to Happen CrowdStrike shares jumped roughly 14% on Sept. 14 as capital rotated into cybersecurity names on AI-threat headlines. ” Brown owns CrowdStrike and isn’t trading it. For everyone else, he flagged $215 to $220 as the post-earnings base, with the 50-day at $207 as the deeper line.
RSI sits at 60 — constructive, not stretched. Palo Alto and Fortinet Palo Alto Networks gets the same thesis with a weaker chart. After running from the $184 area in early May to just under $400, each rally has topped out lower, and shares now trade near $364. RSI of 53 reads as drift.
Brown’s reference is the $320 to $330 shelf, tested repeatedly and defended each time. A May earnings gap from $90 to $108 kicked off a steady climb of higher highs and higher lows, and shares now sit at $170 inside a $150 to $175 consolidation. The 50-day at $160 is rising. ” Cloudflare’s Breakout Cloudflare isn’t a pure security name, but its DDoS protection, zero-trust products and AI workload delivery put it in the conversation.
Shares hit a new high last week with a breakout in progress, and the 200-day at $228 has finally turned up after months flat. Brown’s exit for short-term holders is a close under the 50-day. Longer-term money should watch $260 to $270, the base the run started from. See More: Top Momentum Stocks The Two Left Off Zscaler has lost about half its value since peaking last October, though the chart is finally stirring.
Shares crossed back above the 200-day for the first time this year, a golden cross is forming, and RSI at 63 marks a 12-month high. Cheap relative to peers, and worth watching — still not on the list. SentinelOne fails the $25 billion market-cap screen, since momentum works better on widely followed large caps. Brown added two personal objections: the ticker once belonged to Sears, and chasing the smaller name in a hot sector usually ends badly.
He closed the column with a solid reminder for readers: "Don’t drink and drive. Don’t buy a whole life policy. Don’t trade the ninth best stock in a sector. " Read Also: Coinbase Wins Either Way?
Why a Dead Bill Isn't Bad News Photo: Alicia97 / Shutterstock