Cisco Systems vs. OKTA: Which Cybersecurity Stock Should You Bet On?

Cisco Systems CSCO and Okta OKTA are both major players in cybersecurity. While Cisco Systems is growing its presence in the sector by offering broad enterprise network security solutions, OKTA focuses on identity and access management, providing cloud-based solutions that help businesses safeguard user data.Per Mordor Intelligence report, the Cybersecurity market is projected to be valued at $234.01 billion in 2025 and is expected to grow to $424.14 billion by 2030, witnessing a CAGR of 12.63% over the 2025-2030 time frame. This strong market outlook highlights the growing importance of cybersecurity and benefits both Cisco Systems and Okta.Cisco Systems or Okta—Which of these cybersecurity stocks has the greater upside potential? Let’s find out.The Case for Cisco Systems StockCisco Systems’ security business is experiencing robust growth, fueled by strong demand for both Cisco Secure Access and XDR. Together, these solutions have attracted more than 1,000 customers in the trailing 12 months, and each of the products has roughly 1 million enterprise users. Hypershield is also gaining traction.In the second quarter of fiscal 2025, Cisco Systems' security orders more than doubled, largely due to Splunk's advanced data management, analytics and threat detection capabilities. Security revenues jumped 117% year over year to $2.11 billion, driven by Splunk, SASE and Network Security.Cisco Systems continues to expand its security solutions. In the reported quarter, the company launched new security products like Splunk on Azure, Splunk Federated Analytics, and the AI Assistant for Splunk Observability, which broadened Cisco Systems’ security portfolio and provided more comprehensive solutions for customers.On March 18, Cisco Systems unveiled an AI factory architecture with NVIDIA that prioritizes security. The companies are collaborating to develop the Cisco Secure AI Factory with NVIDIA to help enterprises deploy, manage and secure AI infrastructure at any scale.The Case for OKTA StockOKTA is benefiting from strong demand for its identity security solutions. More than 20% of fourth-quarter fiscal 2025 bookings were from new products, including Okta Identity Governance, Privileged Access, Device Access, Fine Grain Authorization, Identity Security Posture Management and Identity Threat Protection with Okta AI. Okta Identity Governance, in particular, has been gaining traction with more than 1300 customers and $100 million in Annual Contract Value.The company is experiencing strong demand for its workforce and customer identity solutions, reflecting a growing need for secure identity management across organizations. The company served 19,650 customers at the end of the fourth quarter of fiscal 2025.Okta’s increasing strength in its partner ecosystem, particularly through its relationship with Amazon Web Services (AWS), supported its security efforts. With more than 70% of deals influenced by partners in the fourth quarter of fiscal 2025, Okta was able to leverage its security capabilities more effectively. In fact, OKTA surpassed $1 billion in aggregate total contract value through its partnership with AWS.Stock Price Performance and Valuation of CSCO and OKTAYear to date, Cisco Systems shares have lost 10.2%, while OKTA shares have gained 15.9%. CSCO’s recent drop in share price is primarily due to challenging macroeconomic uncertainty and the rising threat of recession due to tariffs on China, Mexico, and Canada, which have increased the possibility of a trade war. Apart from these factors, CSCO has been suffering from stiff competition in the networking business.CSCO and OKTA Stock Price PerformanceImage Source: Zacks Investment ResearchValuation-wise, CSCO and OKTA shares are currently overvalued, as suggested by a Value Score of D and F.In terms of forward 12-month Price/Sales, CSCO shares are trading at 3.64X, lower than OKTA's 5.47X.CSCO and OKTA ValuationImage Source: Zacks Investment ResearchHow Do Earnings Estimates Compare for CSCO & OKTA?The Zacks Consensus Estimate for CSCO fiscal 2025 earnings is pegged at $3.72 per share, which has remained unchanged over the past 30 days. This indicates a 0.27% decline year over year.Cisco Systems, Inc. Stock Price and Consensus Cisco Systems, Inc. price-consensus-chart | Cisco Systems, Inc. QuoteHowever, the Zacks Consensus Estimate for OKTA fiscal 2026 earnings is pegged at $3.17 per share, which has increased 0.9% over the past 30 days, indicating a 12.81% increase year over year.Okta, Inc. Stock Price and Consensus Okta, Inc. price-consensus-chart | Okta, Inc. QuoteBoth CSCO and OKTA’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. However, OKTA’s average surprise of 15.7% is better than CSCO’s surprise of 4.07%, reflecting good quality of earnings beat on a consistent basis.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Conclusion: Buy OKTA, Hold CSCOWhile CSCO is expanding its footprint in the security space with strong growth in AI and network security, OKTA’s focus on identity solutions, stronger earnings beat and high growth potential make the stock more attractive for investors seeking growth in the cybersecurity space.While OKTA carries a Zacks Rank #2 (Buy), CSCO has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cisco Systems, Inc. (CSCO): Free Stock Analysis Report Okta, Inc. (OKTA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks