Harvard has decided that all classes for its 2020-21 academic year will be administered online, a move that foreshadows how other large institutions in the U.S. might respond to ongoing challenges created by the coronavirus. There's a good chance many schools and businesses will adopt a "better safe than sorry" approach similar to the one being taken by the country's oldest university.

Extended telecommute measures from schools, businesses, and other organizations this year point to rising demand for cybersecurity services, and the increasing need for these protections looks like a safe short-term and long-term bet. Investors looking to capitalize on the trend should consider these three stocks and add CrowdStrike Holdings (CRWD -3.82%), Cloudflare (NET -4.01%), and Palo Alto Networks (PANW -1.88%) to their portfolios.

The Charles River and Harvard University.

The Charles River with Harvard in the background. Image source: Getty Images.

1. CrowdStrike: Device-level protection is more essential than ever

With businesses and schools conducting more of their activities over the internet, more vital information is being transmitted digitally that needs to be protected. CrowdStrike is an endpoint cybersecurity provider, meaning that it protects networked hardware including computers, phones, and servers. The company counts Harvard and many other schools and businesses among its customer base, and it has a big runway for long-term growth. 

CrowdStrike's technology monitors what's occurring on endpoint devices in order to detect and prevent malware, hacking, and data theft. Harvard has credited CrowdStrike with enabling the university to better protect research and student data, and the university's medical school actually includes the company's software in its bundle of apps that have to be installed in order to connect to the campus network.

High-quality device-level protection is essential for preserving confidential data, and the shift toward remote work and remote learning means potential security weak points and the dangers posed by breaches are proliferating. Many businesses are also letting employees use their personal devices to connect to business networks and virtual workspaces, which creates a range of new challenges that are spurring demand for CrowdStrike's services.

With the company currently valued at roughly 29 times this year's expected sales, CrowdStrike stock is certainly priced for growth. But the business' industry-leading services and favorable operating tailwinds should help it continue expanding at a rapid clip. The company's customer count climbed 105% year over year last quarter to reach 6,261, and sales rose 89% to hit $178.1 million. With a subscription-based business that has very high customer retention, strong gross margins, and opportunities to introduce new services, CrowdStrike stock has room to run. 

A person using a laptop and a lock icon.

Image source: Getty Images.

2. Palo Alto Networks: Harvard endowment is an investor

Palo Alto Networks provides businesses, academic institutions, and other organizations with firewalls and other security services that prevent cyberattacks. Signs that COVID-19 will prompt institutions to continue conducting more of their business online point to increasing demand for Palo Alto's offerings, and Harvard's endowment (which is the largest in the country at roughly $40 billion) holds shares in the company. 

Because Harvard is a large institutional investor, the Harvard Management Corp. (HMC) was set up to manage the university's endowment and has to file quarterly asset disclosures in accordance with Securities and Exchange Commission standards. Harvard actually sold shares of Palo Alto Networks in the fourth quarter of last year, but the company's first-quarter filing published in May shows that the management team reversed course on the stock and increased HMC's position in the cybersecurity specialist by 31% compared to the previous filing.

Coronavirus-related conditions likely factored into HMC's big purchase of Palo Alto Networks in the first quarter, and Harvard's decision to host classes for the coming academic year online shows that the university sees the need to keep core operations digital for the foreseeable future.

These conditions suggest a favorable operating backdrop for Palo Alto. The company's core business is being reinvented to provide cloud software services in conjunction with its firewall hardware, and its big acquisitions push in recent years has expanded its offerings to where it can provide a suite of next-generation cybersecurity services. 

Palo Alto Networks has a market capitalization of roughly $24 billion and trades at approximately 52 times this year's expected earnings. 

3. Cloudflare: Keeping hackers from taking advantage

Cloudflare specializes in protecting websites and ensuring they can process and return information quickly. The company's security and performance-enhancement services help support more than 27 million internet properties, and few other businesses play a bigger role in ensuring your daily online experience is a smooth one.

Hackers can crash a website by spoofing a flood of information requests to the domain, but Cloudflare's cybersecurity technologies make it difficult to take advantage of this otherwise easily exploitable line of attack, helping web services remain accessible. The company's market-leading software for web-security and data-delivery infrastructure could drive explosive long-term growth.

Even before 2020's unprecedented circumstances, business was increasingly moving online. This transition is spurring the creation of new websites and software applications, and the conditions brought about by the coronavirus have only accelerated this shift and increased the need for website protection.

There are other tailwinds to look forward to as well. As 5G technologies pave the way for greater upload and download speeds, and a wave of new devices and virtual machines begin communicating with networks, the demand for web infrastructure and security services will only increase. The long-term growth trajectory for digital communications and online business services portends a huge demand increase for Cloudflare's services. And the company's tech leadership is building strong foundations to launch new services that expand its software ecosystems and power new growth. 

Cloudflare is valued at roughly $11.5 billion and trades at 29.5 times expected sales. Like many other players in the space, its valuation already prices in big growth, but don't be surprised if Cloudflare stock soars over the next decade.