Palo Alto Networks (PANW)

Cybersecurity is a mega-trend long term. Bit expensive at 50x forward PE for 13% growth, and that growth rate has come down. That's why he sold. Great channel of higher highs and higher lows.

They've maintained momentum recently even as other tech stocks have come down. Whereas Fortinet and Crowdstrike specialize in parts of cybersecurity, PANW does it all and does very well in small/medium-size companies.

He sold and put profits into CRWD (and then took profits on that, too). Like FTNT, still great names to own long term, as cybersecurity threats are only going to get bigger. Secular demand for software and services will continue. PANW is 53x forward PE, for 15% earnings growth, so he needs a lower PE to be interested. Capex slowdown from businesses in this area.

Has a great platform strategy and products; growing cash flow to $4.5 billion by year's end. Will rebound as they execute.

She sold Z-Scaler to add more PANW whose products are better. PANW is transitioning to offer more platform services. Shares have been lagging the past quarter, trading at -14% to peers, yet growing revenues 15% in coming years. Free cash flow is 37%. This and Crowdstrike are the tops in cyber.

The last quarter was mostly in line. The new platform will take time to transition. It's trading off, because that last quarter was not a blow-out. But cybersecurity stocks will continue to work.

His 12-month price target is $225. Likes it, and has been adding this week. It's like the "Home Hardware" of cybersecurity, covering the whole area, and catering to small- and medium-sized businesses. Wider and deeper total addressable market than other names.

Leading next generation firewall company. Salesforce very strong. However, valuation is full right now. Would wait for share price to fall before buying. Overall, a quality company. 

This sector has good secular growth, lots of cybersecurity issues, governments are investing a lot. Has done very well.

It's grown into an extreme valuation of 135x EBITDA. You hardly see that in the market.

Look for the continued move away from hardware to software and the cloud. Also, they must beat revenue to accelerate the strong momentum of the past 8 weeks. It's overbought this year, but it can grow into an extreme valuation in coming years. Owning this means accepting volatility. Don't be surprised with a pullback.

It makes sense in terms of global unrest and cybersecurity concerns.