Wedbush Says 2026 Is the “Inflection Year” for Artificial Intelligence (AI). Here’s the Stock to Own.

Key Points

At the end of 2025, Wedbush Securities analyst Dan Ives, one of Wall Street’s most outspoken tech bulls, predicted the artificial intelligence (AI) market would reach its “inflection point” in 2026. Ives also named five stocks — Microsoft, Apple, Tesla, Palantir, and CrowdStrike (NASDAQ: CRWD) — as the top plays on that secular trend. While all five of those companies are growing rapidly, I believe CrowdStrike could be the most compelling AI play this year for five simple reasons.

1. It’s the cloud-native cybersecurity leader

Many cybersecurity companies deploy their services via on-site appliances, which take up space, consume significant power, and require constant maintenance. These systems are also expensive to scale as an organization expands.

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CrowdStrike addresses those issues with Falcon, a cloud-native endpoint security platform that doesn’t require any appliances or on-site maintenance. It’s also easier to scale and locks users into sticky subscriptions. That innovative approach widens its competitive moat.

2. Its ecosystem is expanding

CrowdStrike initially provides its customers with a trial bundle of four starter modules and encourages them to purchase more modules for additional services. At the end of fiscal 2026 (which ended this January), 50% of its customers were using at least six of its modules. That’s up from just 24% of its customers at the end of fiscal 2021.

Those modules added more identity, data, and cloud security features to its core platform. It also added more AI-powered features — including its AI-driven threat detection tools, automated agents, and Charlotte AI assistant for analysts — to keep pace with smaller AI-driven competitors like SentinelOne and diversified tech giants like Microsoft, which is expanding its own AI-powered cybersecurity services. In his note to investors, Ives said Wall Street was “underestimating the growth potential for CrowdStrike with cybersecurity remaining a second/third derivative beneficiary of the AI Revolution.”

3. It’s expanding beyond rigid subscriptions

CrowdStrike’s subscription-based model drove most of its early growth, but large companies are reluctant to lock themselves into subscriptions amid uncertain macro headwinds.

To capture more customers in this wobbly market, CrowdStrike is expanding “Falcon Flex” — its consumption-based “pay-as-you-go” plan that doesn’t require any subscriptions. As the market stabilizes, it could convert more of those consumption-based customers into subscribers.

4. It has plenty of room to grow

From fiscal 2021 to fiscal 2026, CrowdStrike’s revenue grew at a 41% CAGR as it pulled thousands of customers away from older cybersecurity companies. Its adjusted gross margin expanded from 79% to 81%, while its adjusted net income increased at a 73% CAGR.

Those explosive growth rates have driven CrowdStrike’s stock up more than 12 times since its public debut at $34 per share on June 12, 2019. But it could still have plenty of upside, even as its business matures and growth rates gradually cool.

From fiscal 2026 to fiscal 2029, analysts expect CrowdStrike’s revenue to grow at a 22% CAGR. They also expect it to turn profitable in fiscal 2027 and grow net income at a near-100% CAGR through fiscal 2029 as it streamlines spending and reins in stock-based compensation.

5. Its stock looks reasonably valued

With a market cap of $103.7 billion, CrowdStrike might not seem like a bargain at 14 times next year’s sales. However, two of its core strengths could justify that higher valuation.

First, it remains one of the world’s largest cybersecurity companies with more than 29,000 enterprise customers. Its 2024 system outage — which disrupted many airports, banks, stores, and other businesses — shows just how widely it’s used.

Second, it’s an evergreen stock because companies generally won’t shut off their digital defenses to save a few dollars. According to Fortune Business Insights, the global cybersecurity market could expand at a steady 13.8% CAGR from 2026 to 2034. CrowdStrike could grow even faster because it’s also exposed to the expanding cloud and AI markets.

Why CrowdStrike is a compelling buy for 2026

CrowdStrike is often considered a cybersecurity stock rather than a cloud or AI one, but it’s a balanced way to profit from all those markets. Investors should accumulate more shares this year, even as the Iran War and other macro headwinds drive investors away from growth stocks.

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Leo Sun has positions in Apple. The Motley Fool has positions in and recommends Apple, CrowdStrike, Microsoft, Palantir Technologies, SentinelOne, and Tesla and is short shares of Apple. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.