Name: Stephanie Link: Palo Alto is poised to grow with expanding margins and demand
Uploaded: 2026-01-08T12:35:51+00:00
Duration: 241 s

Speakers

Stephanie Link — Chief Investment Strategist, Hightower

Summary

Stephanie Link, Chief Investment Strategist at Hightower, names Palo Alto Networks as her Q1 2026 pick and argues it is a full-year, possibly decade-long, cybersecurity opportunity. She says Palo Alto lagged peers and trades at a discount, while acquisitions and platformization should support 15–16% revenue growth, expanding margins, 20%+ RPO growth, and about 20% product revenue growth. Link also argues cybersecurity demand will grow because AI makes coding less secure and the sector should not be displaced by AI, with consolidation likely across a fragmented market.

Stephanie Link names Palo Alto Networks as her Q1 2026 pick.
She calls cybersecurity a full-year and probable decade-long theme bigger than AI.
Link argues AI-driven coding increases security needs and cybersecurity helps the AI narrative.
Palo Alto is described as lagging peers but trading at a valuation discount with growth and margin expansion ahead.
She is comfortable with Palo Alto's four recent acquisitions and platformization strategy.
Link expects massive consolidation in a fragmented cybersecurity market.
The host notes cybersecurity ETFs have underperformed the broad index; Link attributes this to broader software weakness.

Ideas

Stephanie Link Chief Investment Strategist, Hightower 0:16

Lagged Palo Alto has growth ahead.

Link picks Palo Alto Networks for Q1 2026 and says it is a full-year idea because it lagged last year, up only about 10% versus CrowdStrike's roughly 30%, and now trades at a 20% discount to peers on EV/free cash flow and 14x price-to-sales versus 26x for CrowdStrike. She is not worried about integration of four acquisitions in the past six months totaling close to $30 billion, citing strong management and platformization that expands offerings for customers. She expects revenue growth of 15–16%, expanding margins, RPO growth of 20%+, and product revenue growth of about 20%, so the laggard has growth ahead.

Stephanie Link Chief Investment Strategist, Hightower 0:43

Cybersecurity is bigger than AI.

Link believes cybersecurity is a full-year and probably decade-long theme that will be bigger than AI. As more companies use AI for coding and other workflows, security becomes less reliable, increasing demand for safety and cybersecurity companies. She says the sector has been wrongly wrapped into broader software weakness; cybersecurity names are not going to be displaced by AI and should help the AI narrative, making the underperformance an opportunity. She also sees massive consolidation coming among roughly 4,000 public and private cybersecurity companies.

This CNBC video, published January 08, 2026, features Stephanie Link discussing PANW, CIBR. 2 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Stephanie Link · Tickers: PANW, CIBR

Stephanie Link: Palo Alto is poised to grow with expanding margins and demand

Summary

Ideas

Up Next