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| Security Spend Does Not Wait for Permission |
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| Companies love to delay upgrades. They delay them right up until the day something breaks, gets hacked, or shows up in a news alert with their logo next to it. | Then the budget appears instantly, like a miracle, except it is your money and it is on fire. That is why cybersecurity spending tends to stay prioritized. It is not a nice-to-have, it is the seatbelt. | | Future Leaders (Sponsored) | | | Don't miss out on the next big thing in tech.
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| | | Theme: Cybersecurity, The Must-Pay Insurance Line Item | Security spending is not driven by optimism. It is driven by risk. The risk keeps rising because systems are more connected, more cloud-based, and more complex. | More complexity means more attack surface. Boards and executives understand this now. Even in cautious budgets, security is usually protected. | Here is the chain reaction:
Threats increase → boards prioritize security
Priority increases → spending remains protected in budgets
Budgets protected → consolidation into fewer vendors accelerates
Consolidation accelerates → platform winners gain share
Share gains → recurring revenue and margins improve as scale grows | This theme matters because the industry is moving toward platforms. Companies do not want twelve security vendors that do not talk to each other. | They want fewer vendors, better integration, and less operational chaos. That favors companies with broad product suites, strong execution, and the ability to prove outcomes. | It also matters because security often has switching costs. Once a tool is deployed across endpoints, networks, and cloud infrastructure, ripping it out creates risk. | That stickiness supports retention and pricing power, especially for the best platforms. | What we want to see to stay bullish | Strong retention and renewals, even if new deal cycles slow Platform consolidation wins and product attach growth Stable net revenue retention or usage expansion signals Improving margins and disciplined operating spend Guidance that reflects reality without sounding nervous
| What can ruin the party | If enterprise budgets freeze broadly, new deals can get delayed. Competition is intense, and pricing pressure can show up when vendors fight for platform status. | High-growth security names can also be valued on expectations. | Any hint of deceleration can trigger a violent market reaction. Also, regulatory changes can shift spending patterns and priorities. | | | Palo Alto Networks (PANW) | What it does: Cybersecurity platform across network security, cloud security, and endpoint, with a strategy focused on consolidation into a single ecosystem. | Why it fits: Palo Alto is a platform winner candidate. As customers consolidate vendors, broad suites can gain share. | If execution stays clean, it can capture wallet share and expand margins over time. | What could go right: | Continued platform consolidation wins increase share Cloud security demand stays strong as complexity rises Product attach improves revenue per customer Operating leverage supports margin expansion
| What to watch next: Platform adoption trends, net retention signals, and margin progression. Also watch whether deal cycles remain stable. | Risk: Large platform transitions can create billing or optics noise. Competition is fierce, and the market can punish any sign growth is slowing. |
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| | | CrowdStrike (CRWD) | What it does: Endpoint security and broader security platform, known for strong execution and expansion into multiple modules. | Why it fits: Endpoint security is a core must-have category, and CrowdStrike has built a strong platform story around expanding modules. | If customers keep consolidating vendors, it can keep winning wallet share. | What could go right: | Strong module adoption increases revenue per customer Retention remains high due to platform embedment Operating leverage expands margins as scale grows Continued market share gains in endpoint and beyond
| What to watch next: Module adoption metrics, retention trends, and guidance tone on demand. You want steady expansion inside accounts. | Risk: High expectations. Any slowdown in growth or expansion can hit the stock hard. |
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| | | | | Zscaler (ZS) | What it does: Cloud security platform focused on secure access and zero trust network architecture. | Why it fits: As companies move more workloads to cloud and remote access, securing access becomes central. | Zscaler benefits if zero trust adoption keeps expanding as a standard approach. | What could go right: | Increased adoption of zero trust and secure access platforms Strong expansion as customers scale deployments Operating leverage improves margins over time Demand stays durable as cloud and remote work remain core
| What to watch next: Billings and growth signals, large customer adoption, and whether deal cycles are extending. | Risk: Deal timing can be volatile, and competition is intense. Valuation can amplify reactions to any change in guidance. |
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| | | Fortinet (FTNT) | What it does: Cybersecurity across network security and related solutions, known for efficiency and scale. | Why it fits: Fortinet offers a blend of scale and operational efficiency. If security budgets stay steady and customers want reliable solutions with good economics, it can hold up well. | What could go right: | Stable demand for network security as threats persist Efficiency supports margin strength and cash generation Product breadth supports customer retention and upsell Channel strength supports steady deployments
| What to watch next: Revenue growth quality, margin trends, and any signs of stabilization in demand cycles. | Risk: Competitive pricing can pressure growth. Hardware-related cycles can add variability. |
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| | | | Poll: Which loyalty program has actually saved you real money? | |
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| | | Cloudflare (NET) | What it does: Cloud-based network and security services, including protection and performance tools at the edge. | Why it fits: As security and performance needs expand at the edge, Cloudflare can benefit from growing adoption of its platform. | It is a blend of security and infrastructure that can deepen stickiness over time. | What could go right: | Expansion in security product adoption improves mix Strong customer growth and usage expansion Operating leverage improves profitability trajectory Platform breadth increases stickiness and retention
| What to watch next: Dollar-based net retention, growth in larger customers, and any progress on margin expansion. | Risk: Growth names can be sensitive to macro and valuation shifts. Competition in edge services is real. |
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| | Want to make sure you never miss a stock recommendation? | Elite Trade Club now offers text alerts — so you get trending stocks and market-moving news sent straight to your phone before the bell. Email's great. Texts are faster. | 👉 Click here to get our detailed stock analysis sent to your cell for free! | | Cybersecurity is the category that gets funded even when everything else is debated. | The threat environment keeps pushing boards toward action, and vendor consolidation keeps rewarding platforms that can do more with fewer tools. | Watch retention, platform adoption, and operating leverage. | If budgets stay protected and consolidation continues, these five names can benefit in 2026 even if the rest of tech spending stays uneven. | If deal cycles lengthen, focus on the vendors winning share and embedding deeper, because in security, being sticky is not just a business model, it is the point. | Best Regards, | — Adam Garcia
Elite Trade Club |
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