Cybersecurity giant Palo Alto Networks (PANW) stock – along with fellow software names CrowdStrike (CRWD), Fortinet (FTNT), Okta (OKTA), Rubrik (RBRK) and Zscaler (ZS) – headline this week's analysis of ideas from a particular industry.

All of the stock picks come from Investor's Business Daily's Computer Software-Security industry group, which ranks a lofty No. 12 out of the 197 groups IBD tracks. Historically, winning stocks are in the top 40 industry groups, so investors should focus their research on that section of the performance table.

To find a stock's industry ranking, you can use IBD Stock Checkup. The MarketSurge chart is another good resource. Further, the MarketSurge industry group analysis can provide a group's rankings over the past six months.

The ranking for the cybersecurity software group has improved to No. 12 from No. 88 three months ago

With the first-quarter earnings season finishing up, Wall Street has received more clarity about the potential impacts of tariffs on top- and bottom-line numbers, rewarding winners and punishing losers.

Meanwhile, the artificial intelligence revolution is rewriting the rules of cybersecurity. AI-powered cybersecurity revenue will skyrocket from $15 billion in 2021 to a staggering $135 billion by the end of the decade, according to Morgan Stanley.

Palo Alto Networks stock is tracing a cup with handle that offers a 195.42 buy point, per IBD MarketSurge.

On May 20, Palo Alto reported fiscal third-quarter earnings and revenue that edged by Wall Street's targets amid its push into cloud-based cybersecurity services. Guidance for Palo Alto stock met expectations.

"Q3 results were mixed, with annual recurring revenue coming in $10 million above the high end of guidance and revenues near the high end of guidance, but with remaining performance obligations growth of 19% near the low end of guidance, and free cash flow below street expectations," UBS analyst Roger Boyd said in a recent note to clients.

Like many of its industry peers, Palo Alto Networks is adding more AI to its computer security products. On April 28, the company announced the acquisition of Protect AI, a Seattle-based startup specializing in AI-based attacks. The deal, reportedly valued at $500 million, is Palo Alto Networks' biggest acquisition since 2020.

Palo Alto has expanded from the network firewall business into security operations center management, endpoint protection, and other areas. In an interview with IBD, Palo Alto Chief Executive Nikesh Arora discussed how his platformization strategy will drive long-term growth for Palo Alto stock.

Cybersecurity Stocks To Watch: CrowdStrike, Fortinet, Okta

IBD Leaderboard stock CrowdStrike is moving above an alternate entry at 451.15 following a strong breakout above a 400.02 buy point in a cup with handle on April 24. CrowdStrike is building an XDR (extended detection and response), a broad, threat-detection cybersecurity platform. This type of platform monitors endpoints as well as web/email gateways, web application firewalls, and cloud business workloads.

Meanwhile, Fortinet has traced a cup with handle that offers a 109.33 buy trigger.

"Drivers remain solid, and we believe that growing macro uncertainty prevented management from raising guidance slightly. Fortinet continues to benefit from a (firewall) refresh cycle as well as a shift to hybrid platforms as profitability improves," TD Cowen Analyst Shaul Eyal said in a report following Fortinet's May 7 financial results.

Okta is extended above a 118.07 cup-base entry. Based in San Francisco, Okta has a global footprint in the cybersecurity space. Its two pillars are the Okta Platform and the Auth0 Platform.

The Okta platform enables essential cybersecurity functions such as single sign on, multifactorial authentication and identity threat protection. In the artificial intelligence realm and beyond, Auth0 helps secure generative artificial intelligence apps and adaptable authentication.

Through Okta AI, the company helps protect clients against cyberattacks while enabling real-time actions and insights.

Rubrik, Zscaler Extend Gains

IBD Leaderboard name Rubrik is more than 20% past a 76.11 buy point in a double bottom. The data storage and security software firm went public on April 25 last year, with the IPO pricing above its expected range at 32. The stock price has already more than doubled from this level. It has yet to swing to profit, but sales are growing at a tremendous rate. Revenue climbed 35%, 43%, and 47% in the prior three quarters, and are accelerating.

Finally, Zscaler is sharply extended from a double-bottom entry at 216.39.

"Against a high degree of concern on durability of growth, including federal spend, Zscaler delivered a solid quarter and guide," BMO Capital Markets Analyst Keith Bachman said in a report following the company's March 5 quarterly results. "Management's comments around Zero Trust for branch opportunities are intriguing."

As the stock market rally extends its gains, IBD recommends 80%-100% stock exposure under current conditions.

Follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on artificial intelligence stocks, other best stocks to buy and watch and the Dow Jones Industrial Average.