Bitcoin price today: steady near $92k after sharp losses; Fed caution weighs
Investing.com -- Berenberg has initiated coverage on eight U.S. cybersecurity companies, outlining a sector view built around long-duration growth, widening platform consolidation and the increasing influence of AI on security architectures, according to a recent report.
The brokerage began its coverage with “buy” ratings on Okta, Rubrik, SailPoint, SentinelOne and Zscaler, and issued “hold” ratings on CrowdStrike, Qualys and Rapid7.
The brokerage said cybersecurity has been a “secular growth compounder,” citing average revenue growth of 21% since 2020 and an expanding threat landscape driving sustained budget support.
Berenberg flagged that the sector benefits from recurring SaaS revenue, high net retention rates, averaging 110% across its coverage, and the requirement for customers to adopt tools that keep pace with AI-driven attacks.
Okta, Rubrik , SailPoint and SentinelOne were named top picks, with the brokerage pointing to valuation gaps or ongoing business transitions.
Okta’s shares were described as trading near trough multiples despite margin expansion and low-double-digit growth.
Rubrik was positioned as a beneficiary of rising data volumes and cyber-resilience spending, while SailPoint’s shift to SaaS was cited as lifting revenue duration.
SentinelOne was characterised as a mispriced platform transition given its discount to sector EV/sales benchmarks.
Zscaler also received a “buy” rating, with the brokerage noting its execution record, zero-trust expansion and growing contribution from new product categories.
CrowdStrike was assigned a “hold” rating despite what the brokerage called “best-in-class execution,” with Berenberg saying valuation already prices in long-duration growth.
Qualys was also rated “hold” on limited upside after recent share-price gains. Rapid7 received a Hold rating as well, with the brokerage citing slowing growth and a lack of near-term catalysts.
Across the group, Berenberg said companies are likely to continue surprising on margins rather than revenue, pointing to operational leverage and improving non-GAAP operating profitability.
The brokerage said average margins across its coverage rose from negative 8% in 2021 to 15% in 2024 and are expected to widen by another 7.5 percentage points by 2027.
The brokerage said its initiations reflect a framework assessing competitive moats, revenue duration and valuation relative to what is “priced in,” adding that platform vendors continue to command premium multiples as consolidation accelerates in the cybersecurity market.