The cybersecurity industry is witnessing a surge in demand driven by increasing data breaches and the proliferation of hybrid work environments. Companies such as CrowdStrike Holdings, Fortinet, Okta, and Qualys are positioned to benefit from this trend as organizations seek robust IT security solutions. However, short-term growth may be affected by macroeconomic challenges and geopolitical tensions, leading to potential delays in IT investments. The Zacks Security industry carries a Zacks Industry Rank #84, indicating solid near-term prospects, albeit with recent performance trailing behind the broader market.
In 2026, the aggregated earnings estimate for the security industry has risen to $1.83, up from $1.80 a year ago. Despite this positive outlook, the industry has underperformed compared to the broader Zacks Computer and Technology sector and the S&P 500, gaining only 7.8% over the past year compared to 49.6% and 29.8% for the sector and index, respectively. Currently, the industry is trading at a forward price-to-sales ratio of 13.68, significantly higher than the S&P 500’s 5.33.
Key players in the industry include Fortinet, with a projected earnings of $3.02 per share in 2026, and CrowdStrike, with steady demand for its Falcon platform amid rising cybersecurity threats. The consensus for Okta’s fiscal 2027 earnings holds at $3.79 per share. Qualys, benefiting from increasing demand for cloud-based cybersecurity, anticipates earnings of $7.57 per share in 2026. Each company faces unique challenges, including high operating expenses and fluctuating customer demands.
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