Artificial intelligence-driven panic caused a $300 billion market value drop in the software industry on Feb. 3, leading to a broader sell-off in cybersecurity stocks. Morgan Stanley analyst Meta Marshall believes AI is a cybersecurity tailwind, predicting a potential $45 billion market in the coming years, up from $16 billion today.

AI use is expanding the attack surface and improving attack vectors, as seen with an increasing number of AI breaches. Marshall emphasizes the importance of AI security, as organizations face growing threats from advanced phishing, prompt injection, and data poisoning attacks.

Marshall is optimistic about CrowdStrike, with an equal-weight rating and $537 price target. Palo Alto Networks is also a top choice, with an overweight rating and $245 price target. Both companies are expected to report earnings soon, on March 3 and February 17 respectively.

For long-term opportunities, Marshall highlights Zscaler, SentinelOne, Netskope, and SailPoint as having attractive entry points despite year-to-date losses. She expects upside for Zscaler, with an overweight rating and $305 price target, and for SailPoint, with an overweight rating and $25 price target.

SentinelOne is projected to report modest revenue growth above management’s guidance, while Netskope is expected to achieve significant ARR growth in Q4. Marshall reiterated overweight ratings for both companies, with price targets of $18 and $27 respectively. SentinelOne and Netskope are set to report earnings on March 12 and at an undetermined date. Netskope will report earnings on March 11. Stock prices and targets for CRWD, PANW, ZS, SAIL, S, and NTSK were listed. Analysts from Morgan Stanley flagged a $45 billion hidden cybersecurity opportunity. The author has no position in the mentioned stocks. BofA revamped Applied Materials stock price targets after a CEO message.

Read more at Yahoo Finance: Morgan Stanley flags $45B hidden cybersecurity opportunity