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PANW vs. OKTA: Which Cybersecurity Stock Has an Edge Right Now?
Okta gains an edge over Palo Alto Networks as strong growth, rising estimates and lower valuation offset Palo Alto Networks' acquisition costs and EPS pressure.
Mar. 22, 2026 at 4:15am
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Palo Alto Networks and Okta are both capitalizing on the rapid growth of the cybersecurity market, but Okta appears to have an edge over PANW due to its steadier execution, strong product adoption, and more reasonable valuation. While PANW faces near-term headwinds from integration and acquisition-related costs, Okta's earnings estimates have been revised upward and its forward sales multiple is lower than PANW's, making it a more attractive option for investors seeking exposure to cybersecurity growth at a fair price.
Why it matters
The cybersecurity market is projected to witness significant growth in the coming years, driven by the rise of complex attacks. Investors are closely watching the performance of leading cybersecurity players like Palo Alto Networks and Okta to determine which stock offers the best investment opportunity in this rapidly expanding industry.
The details
Palo Alto Networks' wide range of innovative products, strong customer base, and growing opportunities in areas like Zero Trust and SASE continue to support its long-term growth potential. However, the company is facing near-term headwinds due to integration and acquisition-related costs, as well as the equity dilution effect from its recent major acquisitions. On the other hand, Okta is focusing on agentic identity as an important part of its long-term strategy and is benefiting from a rich partner base, which is driving growth in its top and bottom lines. Okta's reasonable valuation, with a forward sales multiple lower than PANW's, makes it more attractive for investors looking for value and stability.
- In the second quarter of fiscal 2026, SASE was Palo Alto Networks' fastest-growing segment, with SASE Annual recurring revenues (ARR) increasing 40% year over year.
- In the second quarter of fiscal 2026, PANW issued 112 million shares as part of the CyberArk deal, which is expected to result in a significant equity dilution effect, hurting the company's bottom-line results.
- In the fourth quarter, Okta's revenues and EPS soared 11.6% and 15.4%, respectively, year over year.
The players
Palo Alto Networks
An American cybersecurity company that provides firewalls and other network security products and services.
Okta
An American identity and access management company that provides cloud software to authenticate and secure users and applications.
The takeaway
Okta's steadier execution, strong product adoption, and more reasonable valuation give it a clear edge over Palo Alto Networks for investors seeking exposure to the growing cybersecurity market at a fair price, despite PANW's innovative products and long-term growth potential.
