Analyst is Bullish on Palo Alto Networks (PANW) Amid AI Safety Concerns

We recently published 10 Stocks Wall Street is Watching Heading into October. Palo Alto Networks, Inc. (NASDAQ:PANW) is one of the stocks Wall Street is watching.

Stephanie Link, Hightower Advisors’ chief investment strategist and portfolio manager, recently talked about her bullish outlook on the cybersecurity industry and explained why she likes Palo Alto Networks.

“I think cyber security is certainly something that we’re in very early innings, something like the second or third innings, and I think a lot of it is because it’s driven by AI,” the analyst said in a program on CNBC. “AI really is not safe at this moment in time, so you need more cyber security. I think you’re going to see consolidation overall in the sector. We have 4,000 cyber security companies in the world, public and private, and I think you’re going to see massive consolidation because quite frankly companies don’t want to have 20 to 30 different vendors. Even the biggest companies like CrowdStrike and PaloAlto don’t offer a one-stop shop. They don’t have everything for their customers. So they’re going to continue to acquire their technologies. Palo Alto is cheaper at 14 times. And so, I think you can own a basket of these names.”

Sands Capital Technology Innovators Fund stated the following regarding Palo Alto Networks, Inc. (NASDAQ:PANW) in its second quarter 2025 investor letter:

“Palo Alto Networks, Inc. (NASDAQ:PANW) is a leading cybersecurity platform. It has leveraged its leading position in firewalls to build strong positions in key emerging segments such as Secure Access Service Edge (SASE), Security Information and Event Management (SIEM), and cloud security. These newer segments collectively make up its Next-Generation Security revenue which is now over $5B in annual run rate revenue with a significant growth runway. We expect cyber security will remain a top priority for customers and continued share gains will support sustainable above average revenue growth. Additionally, we expect AI will be a key factor driving cybersecurity decisions on multiple levels. The usage of AI can make adversaries more effective, can expand the attack surface, and require more advanced security. We believe Palo Alto is one of only a few companies with the necessary data and installed base to thrive in this environment.”

While we acknowledge the potential of PANW as an investment, 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 extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.