Tenable, Palo Alto top security stocks at Wedbush as earning season heats up
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Tenable (NASDAQ:TENB) and Palo Alto Networks (NASDAQ:PANW) are the top two cyber security stocks at Wedbush, as the firm notes with earnings season heating up, the cyber security sector should have a "Joe Burrow-like" results.
Analyst Dan Ives noted that Wall Street is underestimating the "massive strength" in the space and when combined with an uptick in federal spending, there should be a large tailwind in the sector for the next six to 12 months.
The Joe Burrow mention is a reference to the Cincinnati Bengals quarterback, who helped lead the team to an upset victory over the heavily favored Kansas City Chiefs in the AFC Championship game.
"The Colonial Pipeline ransomware attack was ultimately the 'straw that broke the camel's back' for many enterprises in the midst of pursuing digital transformation paths as the stepped up threat levels today (China/Russia hacks, malware, bad actors) has reached a feverish pitch and forcing larger advanced cyber security deal flow across the board," Ives wrote in a note to clients. 
In addition, the analyst pointed out that workforces are continuing to shift to the cloud and with more data and endpoints potentially exposed as workforces have a hybrid workweek, there will be more "advanced threats facing enterprise and federal/state IT infrastructure in the years ahead." 
Ives also added that the firm believes the Biden Administration is "laser focused" on cyber attacks, which should raise spending from the federal government to stop it. 
In addition to Tenable and Palo Alto being the two top cyber security picks at the firm, Wesbush also likes Zscaler (NASDAQ:ZS), CyberArk (NASDAQ:CYBR), Varonis (NASDAQ:VRNS), Fortinet (NASDAQ:FTNT) and Sailpoint Technologies (NYSE:SAIL), adding that Sailpoint has "one of the most attractive risk/reward" profiles due to strong channel checks.x
Last week, Palo Alto Networks (PANW) won an award to modernize the security for the Department of Veteran Affairs as part of a multiyear agreement.