2 Top Cybersecurity Stocks to Buy in March

Key Points

• Cybersecurity stocks experienced a sell-off in early 2026 amid fears of AI-fueled industry disruption.

• Palo Alto Networks and Okta are among the companies that saw share price declines.

• Both businesses are experiencing year-over-year revenue growth and enjoy leadership positions in the industry.

Artificial intelligence (AI) proved to be a boon for tech stocks after ChatGPT launched in 2022. But in 2026, the situation has changed drastically.

Now AI is seen as a disruptive force, threatening to upend business models in industries such as cybersecurity. Stock prices in the sector plunged in February after artificial intelligence giant Anthropic introduced a new AI security tool.

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Wall Street’s knee-jerk reaction creates an opportunity for the industrious investor to scoop up cybersecurity stocks at compelling valuations. Two to consider are Palo Alto Networks (NASDAQ: PANW) and Okta (NASDAQ: OKTA).

Image source: Getty Images.

Reasons to consider Palo Alto Networks stock

Palo Alto Networks is an attractive investment because it’s an industry leader and the largest cybersecurity company by market cap. Consequently, despite Wall Street’s sell-off, customers are unlikely to dump Palo Alto Networks in favor of unproven AI solutions.

Cybersecurity is critically important in today’s digital world. Rival CrowdStrike proved this in 2024 when it accidentally released a software glitch that caused global chaos, creating disruption for airlines, banks, and hospitals.

Moreover, Palo Alto Networks’ sales are healthy, indicating its technology is in demand. In the company’s fiscal second quarter (ended Jan. 31), revenue rose a healthy 15% year over year to $2.6 billion.

In addition, the company is constantly evolving its protections. For instance, it acquired CyberArk in February, marking its first foray into the identity security space. This serves as a potent new source of sales growth. In the third quarter, CyberArk posted $342.8 million in revenue, up a whopping 43% year over year.

Palo Alto Networks’ solutions include defenses against quantum computers, which are capable of hacking through most of today’s existing cybersecurity. According to the company, it introduced “the industry’s first cipher translation, which instantly upgrades any application to be quantum safe.” As quantum computers move past the early stages of development, they become increasingly more of a threat, making Palo Alto Networks a key security provider.

Yet its share price drop suggests it’s at an alluring valuation. This can be seen in its forward price-to-earnings ratio, which tells you how much investors are willing to pay for a dollar of earnings based on estimates for the next 12 months.

PANW PE Ratio (Forward) data by YCharts.

The chart shows Palo Alto Networks’ forward earnings multiple is lower than it’s been for most of the past year. In fact, it’s below the level seen last April, when the Trump administration’s tariff policies caused the stock market to crash.

Why Okta is a worthwhile stock

Okta is one of the top five identity security companies in the space. It protects organizations from cyberattacks by recognizing who should have access to a customer’s IT network. Anthropic’s new AI security tool is designed to look for software vulnerabilities, so it can’t replace Okta.

Moreover, in an age where a growing number of organizations are adopting agentic AI to perform tasks, recognizing which automated agents are allowed to access an IT system becomes increasingly difficult. Okta can make this distinction, which makes its services critical as AI agents proliferate.

Okta’s solutions are proving popular, as demonstrated by the company’s growing sales. In its 2026 fiscal year (ended Jan. 31), revenue rose 12% year over year to $2.9 billion. It expects to continue seeing sales growth in fiscal 2027 with forecasted revenue of $3.2 billion.

Along with rising revenue, Okta’s financial health is strengthening. It ended fiscal 2026 with operating income of $149 million compared to an operating loss of $74 million in the previous year.

The company also exited the 2026 fiscal year with an outstanding balance sheet. Total assets were $9.7 billion with cash, cash equivalents, and short-term investments of $2.6 billion. Total liabilities were $2.7 billion, but nearly $2 billion of that comprised deferred revenue, which are up-front payments from customers that will be recognized as sales once services are delivered.

Despite the positives, Wall Street indiscriminately sold cybersecurity stocks this year, resulting in an attractive share price valuation for Okta.

OKTA PE Ratio (Forward) data by YCharts.

The chart shows Okta’s forward earnings multiple has dropped significantly. It isn’t far from its low point for the past year.

Okta’s growing sales and operating income combined with an outstanding balance sheet make it a solid cybersecurity company. Its lowered valuation means now is a good time to buy shares.

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Robert Izquierdo has positions in CrowdStrike, Okta, and Palo Alto Networks. The Motley Fool has positions in and recommends CrowdStrike and Okta. The Motley Fool recommends Palo Alto Networks. The Motley Fool has a disclosure policy.