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Goldman Sachs Cybersecurity Stocks Outlook for 2025 By Investing.com


Investing.com — The cybersecurity sector is poised for stability and improving fundamentals in 2025, given continued demand for platform-based solutions, according to Goldman Sachs.

Companies like Fortinet Inc (NASDAQ:), CrowdStrike Holdings Inc (NASDAQ:), and Cloudflare Inc (NYSE: ) has seen significant gains in 2024, with shares up 63%, 37% and 31% respectively.

These leaders have been rewarded for their platform-driven approaches, which align with the increasing focus of CIOs (chief information officers) on total cost of ownership and vendor consolidation. Dot product companies love it, though Okta Inc (NASDAQ: ) and Zscaler (NASDAQ: ) lagged behind, with shares down 12% and 17%, respectively.

Goldman Sachs upgraded Cloudflare Inc (NYSE: ) to “buy” with a $140 price target, given continued improvements in sales productivity and growing traction in AI-driven developer services. The stock is forecast to rise 28%, driven by new monetization opportunities in edge computing and AI-powered reasoning.

While Check Point Software (NASDAQ: may not materialize until 2026.

Other notable calls include Fortinet, which maintains a “buy” rating with 20% upside potential. The company is well-positioned to take advantage of progress in the firewall refresh cycle, with analysts highlighting Fortinet’s broad cross-selling capabilities across its network portfolio.

The cybersecurity sector exited 2024 trading at a 25% premium to the broader software industry based on enterprise value-to-sales multiples. This assessment reflects favorable long-term growth drivers for the sector, including increased risks of breaches, increasing regulatory oversight and the adoption of advanced AI technologies.

While the sector is expected to grow 9% annually in 2025, down slightly from 2024, the report states that slowing trends are stabilizing. This is likely to set the stage for positive revenue changes in the coming quarters.

GS flagged potential competitive pressures from hyperscalers like Microsoft (NASDAQ: ) and Google (NASDAQ: ), which are expanding their security offerings. He also pointed to geopolitical and macroeconomic uncertainties, particularly in key markets such as Europe.

Still, the industry’s broader outlook remains optimistic.

While cybersecurity companies navigate a volatile macro environment, those with strong platform strategies and diverse offerings appear best positioned to outperform in 2025 and beyond.





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