Cramer Backs CrowdStrike, Palo Alto After 84% and 106% Rallies as AI Threats Lift Demand
Updated
Updated · CNBC · Aug 17
Cramer Backs CrowdStrike, Palo Alto After 84% and 106% Rallies as AI Threats Lift Demand
3 articles · Updated · CNBC · Aug 17
Summary
CrowdStrike and Palo Alto can keep climbing despite year-to-date gains of 84% and 106%, Jim Cramer said, arguing investors should not automatically take profits in cybersecurity names.
AI is boosting, not undermining, the sector’s outlook because more cyberattacks and broader cloud adoption are pushing companies to spend more on digital protection.
TD Cowen reinforced that view by lifting its CrowdStrike target to $235 from $175 and Palo Alto to $400 from $360 while keeping buy ratings on both.
CrowdStrike stood out in Cramer’s case: he called it cloud-native and said its business is only 15% penetrated, leaving a long runway for growth.
The call marks a sharp turn from the first-half software sell-off, when cybersecurity stocks were hit by fears that AI would weaken traditional software pricing power.
With hackers weaponizing AI at unprecedented speeds, is the recent surge in cybersecurity stocks a lasting boom or a speculative bubble waiting to burst?
If AI makes cyberattacks infinitely scalable, are current security stock valuations actually underestimating the impending corporate defense spending boom?
Could the very AI technology driving CrowdStrike's massive rally eventually empower companies to build their own automated defenses and ditch expensive vendors?