Friday's edition of CNBC's "Halftime Report Final Trades" brought three compelling picks from market pros betting on cybersecurity and financial services—two sectors that rarely disappoint when it comes to drama and growth potential.
Zscaler: Betting on Earnings and AI Security
Malcolm Ethridge, managing partner at Capital Area Planning Group, went with Zscaler, Inc. (ZS), which reports quarterly earnings next week. The timing isn't accidental—analysts expect the cloud security company to post earnings of 86 cents per share, up from 77 cents in the same quarter last year. Revenue forecasts sit at $773.86 million, a healthy jump from the $627.96 million reported a year earlier.
What's driving the optimism? Enterprise demand for Zero Trust and AI-driven security keeps climbing, and Zscaler is positioning itself right in the sweet spot. Wedbush analysts recently boosted their price target to $350, pointing to the company's expanding AI capabilities—including acquisitions like Red Canary and SPLX—plus growing momentum in programs like Z-Flex and ZDX.
With a market cap approaching $51 billion and shares trading near their 52-week high, Zscaler is increasingly viewed as one of the prime beneficiaries of the AI security boom. Not a bad setup heading into an earnings report.
Raymond James: The Financial Pick
Brian Belski, founder, CEO and chief investment officer at Humilis Investment Strategies, chose Raymond James Financial, Inc. (RJF) as his final trade. His timing looks solid considering the company's recent earnings beat on October 22. Raymond James posted quarterly earnings of $3.11 per share, crushing the consensus estimate of $2.82 per share. Revenue also topped expectations, coming in at $3.727 billion versus the $3.625 billion analysts anticipated.
Palo Alto Networks: Analyst Darling
Stephanie Link, chief investment strategist, head of investment solutions and portfolio manager at Hightower Advisors, rounded out the trio with Palo Alto Networks, Inc. (PANW). Her pick gained support from a wave of analyst upgrades on November 13, when Evercore ISI Group, Morgan Stanley, UBS and TD Cowen all raised their price targets on the cybersecurity giant.
How They Traded
Friday's session showed mixed results for the three picks. Raymond James Financial shares dipped 1.5% to close at $158.73. Zscaler fell 3% to settle at $299.45. Palo Alto Networks edged up 0.2% to finish at $205.25, showing some resilience in a choppy market.
