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Cybersecurity stocks rally as Evercore ISI survey points to firmer year-end security budgets
Palo Alto Networks and CrowdStrike gained about 6% on Friday, bucking a broad tech sell-off, after a channel partner survey flagged steady demand and a new PHP flaw added urgency.
HedgeWeekly News Desk ·
Cybersecurity shares climbed on Friday after Evercore ISI's quarterly survey of channel partners described a firming budget outlook for security spending into year-end. Palo Alto Networks rose 5.9% to $375.82 by midday, after touching $379.09, and CrowdStrike was up 5.87% at 1:20 p.m. ET. Okta and Zscaler also advanced, and the First Trust NASDAQ Cybersecurity ETF was up 1% in morning trade.
The resellers and integrators surveyed reported healthy pipelines and said they saw no drop-off in demand ahead. Identity protection, AI governance and cloud security ranked as the top enterprise priorities, and the survey named CrowdStrike and Palo Alto as the main winners from AI-related security spending. Okta showed the strongest pipeline momentum among the vendors covered.
Evercore also pointed to PHP2Shell, two critical remote-code-execution flaws in the PHP language disclosed on October 21 and rated 9.2 out of 10 on the CVSS v4.0 scale, as a likely spur to spending. PHP underpins roughly 70% of websites, and CERT-EU, ENISA and Europol issued coordinated warnings. Separately, Mizuho lifted its CrowdStrike price target to $275 from $250 on Thursday.
The rally stood out against a weak tape: at 3:34 p.m. ET the Dow was down 1.16% and the Nasdaq Composite was off 0.14%, a day after the Nasdaq's worst session since June and what Reuters reported was hedge funds' worst day since the Covid-era rout. For investors rotating within tech, security software is drawing money as AI hardware names wobble, but channel checks are not reported results; Palo Alto still trades well below its 52-week high of $432.33, and upcoming earnings, including Okta's next report, will show whether pipelines convert into bookings.