3 Cybersecurity Stocks Poised for AI-Driven Growth

Wedbush analyst sees major tailwind for select firms despite software sell-off

Published on Feb. 19, 2026

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According to Wedbush analyst Dan Ives, the rise of AI-powered cyber threats is creating a 'major tailwind' for certain cybersecurity stocks, even as the broader software sector faces an AI-driven sell-off. Ives identifies CrowdStrike, Palo Alto Networks, and Zscaler as top picks positioned to benefit from increased security spending as companies look to defend against more sophisticated AI-enabled attacks.

Why it matters

The growing use of AI has raised concerns about business models across various industries, but in the cybersecurity sector, the threat of AI-powered hacks is actually driving increased spending on defense. As the 'attack lifecycle' accelerates, companies are forced to prioritize cybersecurity as a mission-critical expense, creating opportunities for vendors that can provide automated, AI-driven protection.

The details

Wedbush's data shows that cybersecurity vendors are hiking their sales targets by as much as 30% this year to keep up with strengthening demand, even as general enterprise software budgets face scrutiny. The firm believes CrowdStrike, Palo Alto Networks, and Zscaler are best positioned to capitalize on this trend. CrowdStrike's Falcon platform is becoming more effective against AI-powered threats, while Palo Alto Networks' 'platformization' approach and acquisition of CyberArk aim to streamline security tools. Zscaler's 'Zero Trust' strategy is also seeing strong subscription growth as enterprises grapple with a surge in AI-driven network traffic.

  • Cybersecurity stocks have endured a rough 2026 alongside an AI-driven sell-off in software stocks.

The players

Dan Ives

A Wedbush analyst who believes AI will be a 'major tailwind' for the cybersecurity sector.

CrowdStrike

A cybersecurity firm that Wedbush calls the industry's 'gold standard', with a Falcon platform that is becoming more effective against AI-powered threats.

Palo Alto Networks

A cybersecurity company that Wedbush believes has a 'game-changing' 'platformization' approach, combined with the acquisition of CyberArk, to secure AI data pipelines.

Zscaler

A cybersecurity firm whose 'Zero Trust' strategy is seeing strong subscription growth as enterprises grapple with a surge in AI-driven network traffic.

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What they’re saying

“AI will be a major tailwind to the cyber security sector over the coming years as protection of use cases, data, and end points expand markedly.”

— Dan Ives, Wedbush Analyst (Yahoo Finance)

The takeaway

While the broader software sector faces an AI-driven sell-off, the cybersecurity industry is poised for growth as the rise of AI-powered threats forces companies to prioritize security spending. Investors may find opportunities in select cybersecurity stocks that are well-positioned to capitalize on this trend, such as CrowdStrike, Palo Alto Networks, and Zscaler.