10 Best Cybersecurity for February 2026
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Market Overview & Selection Criteria
The cybersecurity sector remains a critical focus amid rising digital threats and enterprise spending on security solutions. ValueSense analysis highlights 10 top cybersecurity stocks selected based on intrinsic value comparisons, quality ratings, revenue growth, free cash flow generation, and margin profiles. These picks emphasize companies showing potential undervaluation where intrinsic value exceeds implied market pricing, alongside strong financial metrics like high gross margins and ROIC. Selection prioritizes diversified cybersecurity leaders across software, networks, and identity management, using ValueSense's proprietary ratings (scale of 1-10) and key ratios for balanced educational review. This watchlist targets best value stocks in cybersecurity for retail investors analyzing long-term opportunities.
Featured Stock Analysis
Stock #1: International Business Machines Corporation (IBM)
| Metric | Value |
|---|---|
| Market Cap | $286.7B |
| Quality Rating | 6.8 |
| Intrinsic Value | $201.0 |
| 1Y Return | 19.5% |
| Revenue | $67.5B |
| Free Cash Flow | $12.3B |
| Revenue Growth | 7.6% |
| FCF margin | 18.2% |
| Gross margin | 58.8% |
| ROIC | 11.9% |
| Total Debt to Equity | 205.1% |
Investment Thesis
International Business Machines Corporation (IBM) stands out with a robust $286.7B market cap and a Quality rating of 6.8 from ValueSense. Its intrinsic value of $201.0 suggests significant undervaluation potential relative to market dynamics. Generating $67.5B in revenue and $12.3B in free cash flow, IBM demonstrates stability with 7.6% revenue growth, 18.2% FCF margin, 58.8% gross margin, and 11.9% ROIC. Despite a high Total Debt to Equity of 205.1%, its 19.5% 1Y Return underscores resilience in enterprise tech, particularly hybrid cloud and cybersecurity services, positioning it as a foundational pick for diversified portfolios seeking reliable cash flows.
Key financials reveal a mature player leveraging scale for consistent profitability, making IBM a compelling case for value-oriented analysis in the cybersecurity-adjacent space.
Key Catalysts
- Strong revenue base at $67.5B supports sustained investment in AI-driven security solutions.
- High free cash flow of $12.3B enables dividends and buybacks amid 7.6% growth.
- Solid 11.9% ROIC indicates efficient capital allocation in enterprise markets.
- 19.5% 1Y Return reflects market recognition of turnaround efforts.
Risk Factors
- Elevated Total Debt to Equity at 205.1% could pressure finances in rising rate environments.
- Moderate revenue growth of 7.6% lags high-growth peers in pure cybersecurity.
- Legacy business segments may face competition from cloud-native disruptors.
Stock #2: Palo Alto Networks, Inc. (PANW)
| Metric | Value |
|---|---|
| Market Cap | $120.1B |
| Quality Rating | 7.2 |
| Intrinsic Value | $88.1 |
| 1Y Return | -5.6% |
| Revenue | $9,556.7M |
| Free Cash Flow | $4,021.5M |
| Revenue Growth | 15.3% |
| FCF margin | 42.1% |
| Gross margin | 73.5% |
| ROIC | 8.9% |
| Total Debt to Equity | 4.0% |
Investment Thesis
Palo Alto Networks, Inc. (PANW) features a $120.1B market cap and ValueSense Quality rating of 7.2, with an intrinsic value of $88.1 indicating undervaluation. It reports $9,556.7M revenue, $4,021.5M free cash flow, 15.3% revenue growth, exceptional 42.1% FCF margin, 73.5% gross margin, and 8.9% ROIC. Low Total Debt to Equity of 4.0% enhances balance sheet strength, even with a -5.6% 1Y Return amid market volatility. PANW's platform approach in next-gen firewalls and cloud security positions it for enterprise adoption, offering a blend of growth and profitability for PANW analysis enthusiasts.
This profile highlights PANW's margin leadership, ideal for investors evaluating scalable cybersecurity platforms.
Key Catalysts
- Impressive 42.1% FCF margin and 73.5% gross margin signal pricing power.
- 15.3% revenue growth driven by subscription model expansion.
- Minimal 4.0% Total Debt to Equity supports aggressive R&D investments.
- 8.9% ROIC reflects improving returns on security innovations.
Risk Factors
- Recent -5.6% 1Y Return may indicate short-term valuation pressures.
- Competition in cloud security could erode market share.
- Dependence on enterprise spending cycles poses cyclical risks.
Stock #3: CrowdStrike Holdings, Inc. (CRWD)
| Metric | Value |
|---|---|
| Market Cap | $111.7B |
| Quality Rating | 6.6 |
| Intrinsic Value | $79.3 |
| 1Y Return | 11.2% |
| Revenue | $4,565.2M |
| Free Cash Flow | $1,155.6M |
| Revenue Growth | 22.0% |
| FCF margin | 25.3% |
| Gross margin | 74.1% |
| ROIC | (15.6%) |
| Total Debt to Equity | 20.2% |
Investment Thesis
CrowdStrike Holdings, Inc. (CRWD) boasts a $111.7B market cap and 6.6 Quality rating, with intrinsic value at $79.3 pointing to upside. Key metrics include $4,565.2M revenue, $1,155.6M free cash flow, 22.0% revenue growth, 25.3% FCF margin, 74.1% gross margin, but negative 15.6% ROIC and 20.2% Total Debt to Equity. A 11.2% 1Y Return shows momentum in endpoint detection. CRWD's cloud-native Falcon platform drives high growth, making it a key watch for cybersecurity stock picks focused on innovative threat intelligence.
Despite ROIC challenges, rapid revenue expansion underscores CRWD's disruptive potential.
Key Catalysts
- Accelerating 22.0% revenue growth from expanding module adoption.
- 74.1% gross margin supports scalability in cloud security.
- 11.2% 1Y Return amid market favoring growth leaders.
- Strong $1,155.6M FCF bolsters path to profitability.
Risk Factors
- Negative 15.6% ROIC signals capital efficiency concerns.
- 20.2% Total Debt to Equity adds leverage risk.
- High valuation multiples vulnerable to growth slowdowns.
Stock #4: Fortinet, Inc. (FTNT)
| Metric | Value |
|---|---|
| Market Cap | $61.3B |
| Quality Rating | 7.6 |
| Intrinsic Value | $74.5 |
| 1Y Return | -19.5% |
| Revenue | $6,554.7M |
| Free Cash Flow | $2,028.4M |
| Revenue Growth | 14.8% |
| FCF margin | 30.9% |
| Gross margin | 81.3% |
| ROIC | 49.6% |
| Total Debt to Equity | 135.5% |
Investment Thesis
Fortinet, Inc. (FTNT) has a $61.3B market cap, top-tier 7.6 Quality rating, and $74.5 intrinsic value. It delivers $6,554.7M revenue, $2,028.4M free cash flow, 14.8% growth, 30.9% FCF margin, 81.3% gross margin, standout 49.6% ROIC, though 135.5% Total Debt to Equity. -19.5% 1Y Return suggests entry opportunity. FTNT's integrated security fabric excels in performance, ideal for FTNT analysis in unified threat management.
Exceptional ROIC highlights operational excellence despite recent underperformance.
Key Catalysts
- Industry-leading 49.6% ROIC from efficient operations.
- 81.3% gross margin and 30.9% FCF margin drive profitability.
- 14.8% revenue growth via hardware-software synergy.
- Broad product portfolio aids cross-sell opportunities.
Risk Factors
- High 135.5% Total Debt to Equity raises solvency questions.
- -19.5% 1Y Return reflects competitive pressures.
- Shift to cloud may disrupt hardware reliance.
Stock #5: Cloudflare, Inc. (NET)
| Metric | Value |
|---|---|
| Market Cap | $61.0B |
| Quality Rating | 5.9 |
| Intrinsic Value | $52.6 |
| 1Y Return | 29.2% |
| Revenue | $2,013.4M |
| Free Cash Flow | $216.4M |
| Revenue Growth | 28.1% |
| FCF margin | 10.7% |
| Gross margin | 75.2% |
| ROIC | (16.1%) |
| Total Debt to Equity | 105.5% |
Investment Thesis
Cloudflare, Inc. (NET) carries a $61.0B market cap and 5.9 Quality rating, with $52.6 intrinsic value signaling value. Metrics show $2,013.4M revenue, $216.4M free cash flow, 28.1% growth, 10.7% FCF margin, 75.2% gross margin, 16.1% ROIC, and 105.5% Total Debt to Equity. 29.2% 1Y Return highlights momentum in edge security and CDN. NET's zero-trust model positions it for web security growth.
High growth offsets early-stage profitability hurdles.
Key Catalysts
- Explosive 28.1% revenue growth from network expansion.
- 75.2% gross margin supports margin expansion potential.
- 29.2% 1Y Return driven by developer ecosystem.
- Scalable platform for zero-trust adoption.
Risk Factors
- Negative 16.1% ROIC indicates investment phase risks.
- 105.5% Total Debt to Equity amplifies volatility.
- Low 10.7% FCF margin reflects scaling costs.
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Stock #6: Zscaler, Inc. (ZS)
| Metric | Value |
|---|---|
| Market Cap | $32.0B |
| Quality Rating | 6.6 |
| Intrinsic Value | $149.4 |
| 1Y Return | -1.4% |
| Revenue | $2,833.3M |
| Free Cash Flow | $852.4M |
| Revenue Growth | 23.2% |
| FCF margin | 30.1% |
| Gross margin | 76.7% |
| ROIC | (6.7%) |
| Total Debt to Equity | 92.5% |
Investment Thesis
Zscaler, Inc. (ZS) features $32.0B market cap, 6.6 Quality rating, and premium $149.4 intrinsic value. It posts $2,833.3M revenue, $852.4M free cash flow, 23.2% growth, 30.1% FCF margin, 76.7% gross margin, 6.7% ROIC, 92.5% Total Debt to Equity, and -1.4% 1Y Return. ZS's cloud security gateway leads SASE trends, offering undervalued stocks appeal.
Balanced growth and margins position ZS for proxy maturity.
Key Catalysts
- 23.2% revenue growth from zero-trust shift.
- 30.1% FCF margin shows cash conversion strength.
- 76.7% gross margin aids profitability ramp.
- High intrinsic value suggests re-rating potential.
Risk Factors
- Negative 6.7% ROIC from growth investments.
- 92.5% Total Debt to Equity heightens risk.
- -1.4% 1Y Return amid valuation debates.
Stock #7: CyberArk Software Ltd. (CYBR)
| Metric | Value |
|---|---|
| Market Cap | $21.7B |
| Quality Rating | 5.8 |
| Intrinsic Value | $221.5 |
| 1Y Return | 15.9% |
| Revenue | $1,302.9M |
| Free Cash Flow | $198.3M |
| Revenue Growth | 43.3% |
| FCF margin | 15.2% |
| Gross margin | 76.5% |
| ROIC | (10.8%) |
| Total Debt to Equity | 52.3% |
Investment Thesis
CyberArk Software Ltd. (CYBR) has $21.7B market cap, 5.8 Quality rating, $221.5 intrinsic value. Includes $1,302.9M revenue, $198.3M free cash flow, stellar 43.3% growth, 15.2% FCF margin, 76.5% gross margin, 10.8% ROIC, 52.3% Total Debt to Equity, 15.9% 1Y Return. CYBR dominates privileged access management, a hot cybersecurity stock niche.
Hyper-growth differentiates CYBR in identity security.
Key Catalysts
- Exceptional 43.3% revenue growth from PAM demand.
- 15.9% 1Y Return reflects market traction.
- 76.5% gross margin for sustained scaling.
- Attractive intrinsic value for long-term holders.
Risk Factors
- Negative 10.8% ROIC signals early losses.
- 52.3% Total Debt to Equity adds caution.
- Smaller scale versus mega-caps limits bargaining power.
Stock #8: Check Point Software Technologies Ltd. (CHKP)
| Metric | Value |
|---|---|
| Market Cap | $19.2B |
| Quality Rating | 6.6 |
| Intrinsic Value | $273.8 |
| 1Y Return | -18.0% |
| Revenue | $2,684.2M |
| Free Cash Flow | $1,184.9M |
| Revenue Growth | 6.3% |
| FCF margin | 44.1% |
| Gross margin | 86.2% |
| ROIC | 81.6% |
| Total Debt to Equity | 0.0% |
Investment Thesis
Check Point Software Technologies Ltd. (CHKP) offers $19.2B market cap, 6.6 Quality rating, lofty $273.8 intrinsic value. Key stats: $2,684.2M revenue, $1,184.9M free cash flow, 6.3% growth, 44.1% FCF margin, 86.2% gross margin, elite 81.6% ROIC, zero Total Debt to Equity. -18.0% 1Y Return presents value entry. CHKP's firewall legacy ensures steady stock watchlist inclusion.
Debt-free balance sheet and ROIC shine brightly.
Key Catalysts
- Outstanding 81.6% ROIC and 86.2% gross margin.
- 44.1% FCF margin with pristine 0.0% debt.
- Proven track record in threat prevention.
- High intrinsic value for conservative analysis.
Risk Factors
- Slow 6.3% growth trails innovators.
- -18.0% 1Y Return signals innovation lag.
- Mature market saturation risks.
Stock #9: F5, Inc. (FFIV)
| Metric | Value |
|---|---|
| Market Cap | $15.9B |
| Quality Rating | 7.0 |
| Intrinsic Value | $315.7 |
| 1Y Return | -8.6% |
| Revenue | $3,144.0M |
| Free Cash Flow | $861.2M |
| Revenue Growth | 8.8% |
| FCF margin | 27.4% |
| Gross margin | 81.7% |
| ROIC | 20.3% |
| Total Debt to Equity | 0.0% |
Investment Thesis
F5, Inc. (FFIV) at $15.9B market cap, 7.0 Quality rating, $315.7 intrinsic value. Delivers $3,144.0M revenue, $861.2M free cash flow, 8.8% growth, 27.4% FCF margin, 81.7% gross margin, 20.3% ROIC, 0.0% Total Debt to Equity. -8.6% 1Y Return offers appeal. F5's application security and delivery focus complements investment opportunities in multi-cloud.
Clean balance sheet bolsters stability.
Key Catalysts
- Strong 20.3% ROIC and 81.7% gross margin.
- Debt-free with solid $861.2M FCF.
- 8.8% growth in app security demand.
- Substantial intrinsic value upside.
Risk Factors
- -8.6% 1Y Return amid competitive app sec space.
- Moderate growth limits explosive potential.
- Evolving cloud shifts challenge legacy products.
Stock #10: Okta, Inc. (OKTA)
| Metric | Value |
|---|---|
| Market Cap | $15.1B |
| Quality Rating | 6.7 |
| Intrinsic Value | $133.7 |
| 1Y Return | -9.9% |
| Revenue | $2,840.0M |
| Free Cash Flow | $684.2M |
| Revenue Growth | 12.1% |
| FCF margin | 24.1% |
| Gross margin | 77.1% |
| ROIC | 1.5% |
| Total Debt to Equity | 12.3% |
Investment Thesis
Okta, Inc. (OKTA) rounds out with $15.1B market cap, 6.7 Quality rating, $133.7 intrinsic value. Metrics: $2,840.0M revenue, $684.2M free cash flow, 12.1% growth, 24.1% FCF margin, 77.1% gross margin, 1.5% ROIC, low 12.3% Total Debt to Equity. -9.9% 1Y Return suggests rebound potential in identity management.
OKTA's workforce/customer identity leadership fits best value stocks theme.
Key Catalysts
- 12.1% revenue growth in IAM market.
- Healthy 24.1% FCF margin and 77.1% gross.
- Low 12.3% debt enables flexibility.
- Intrinsic value supports recovery narrative.
Risk Factors
- Low 1.5% ROIC indicates optimization needs.
- -9.9% 1Y Return from growth deceleration fears.
- Intense competition in identity space.
Portfolio Diversification Insights
These 10 cybersecurity stock picks create a well-rounded watchlist spanning established giants like IBM and CHKP (high ROIC, low debt) with high-growth names like CYBR and NET (revenue surges >20%). Sector allocation is 100% technology/cybersecurity, but sub-themes diversify: endpoint (CRWD), network (PANW, FTNT), cloud/zero-trust (ZS, NET), identity (OKTA, CYBR), and firewalls/apps (CHKP, FFIV). Larger caps (IBM, PANW) provide stability, while mid-caps (CYBR, FFIV) add growth. Balance high intrinsic value plays (CHKP, FFIV) with margin leaders (FTNT, PANW) to mitigate risks like negative ROIC in scalers (CRWD, NET). This mix reduces single-stock exposure while capturing cybersecurity tailwinds.
Market Timing & Entry Strategies
Consider positions during sector pullbacks, as seen in negative 1Y Returns for FTNT -19.5%, CHKP -18.0%, and OKTA -9.9%, aligning with high intrinsic values. Monitor Q4 earnings for revenue growth beats (e.g., CYBR's 43.3%). Dollar-cost average into quality-rated names (>7.0 like FTNT, PANW) on dips below intrinsic value. Track macro factors like interest rates impacting debt-heavy firms (IBM, FTNT). Use ValueSense tools for real-time updates before entering, focusing on FCF trends for sustained momentum.
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FAQ Section
How were these stocks selected?
These top 10 cybersecurity stocks were chosen using ValueSense criteria like Quality ratings (avg. ~6.7), intrinsic value upside, revenue growth (>6%), and FCF margins, focusing on cybersecurity leaders for diversified analysis.
What's the best stock from this list?
Fortinet (FTNT) leads with 7.6 Quality rating, 49.6% ROIC, and 81.3% gross margin, though CHKP's 81.6% ROIC and zero debt make it a close contender—evaluate based on risk tolerance.
Should I buy all these stocks or diversify?
Diversify across sub-sectors (e.g., 30% established like IBM/CHKP, 40% growth like CRWD/ZS, 30% value like FFIV/OKTA) to balance stability and upside, avoiding over-concentration in high-debt names.
What are the biggest risks with these picks?
Key concerns include high debt (IBM 205.1%, FTNT 135.5%), negative ROIC in growth stocks (CRWD -15.6%, NET -16.1%), and variable 1Y Returns (-19.5% FTNT to +29.2% NET), plus sector competition.
When is the best time to invest in these stocks?
Target dips below intrinsic values (e.g., ZS at $149.4, CYBR $221.5) or post-earnings growth confirmations, using market volatility for entry while monitoring FCF and macro rates.