The United States economy is full of innovation. It has to be. Manufacturing industries that dominated the economy decades ago - textiles, televisions, even automobiles to a large degree - have moved overseas, where labor and materials costs are lower. Yet the U.S. economy, even during the pandemic and the current period of high inflation, has expanded to record levels. If U.S. corporations weren't innovating, creating new products (such as vaccines and AI) and services (such as Zoom calls) and moving into new markets, the domestic economy would not be growing, and capital would not be flooding into the country. The current high level of the U.S. dollar relative to currencies around the world attests to the confidence that global investors have in the durable and innovative U.S. economy.

The large number of security breaches in recent years forced businesses and governments to invest heavily in cybersecurity services. Cybercrime cost the world an estimated $6 trillion in 2021, compared to $3 trillion in 2015, according to Cybersecurity Ventures. As such, cybercrime represents one of the largest transfers of wealth in the history of humankind. The threat to critical infrastructure as well as threats to national security prompted the U.S. government to create the Cybersecurity and Infrastructure Security Agency (CISA) in 2018. The agency was created to reduce threats to U.S. physical and cyber infrastructure, as well as to coordinate cybersecurity efforts to counter private, as well as government-sponsored hackers. The cyber security solutions market, consisting of dedicated hardware, software, and services, comprises a $170 billion annual revenue opportunity. We expect that to grow at more than a 10% compound annual growth rate (CAGR) over the next several years. The market is comprised of several major sub-segments, including network security, endpoint protection, identity, and access management, among others. Despite the influential positions of several cybersecurity titans, the cybersecurity sector remains receptive to new entrants. This is due in part to low barriers to entry, as well the ever-evolving cyber threat landscape, which keeps companies, government agencies, and non-profits on the lookout for fresh tools to combat the threat of data, financial, and reputation loss.

This pick list highlights constituents of the Morningstar US Large Cap Index that we believe offer investors the best risk-adjusted return prospects. Stocks of large-cap companies where neither growth nor value characteristics predominate. Stocks in the top 70% of the capitalization of the U.S. equity market are defined as large cap.

Palo Alto provides integrated internet security solutions for enterprise customers. The company's solutions are based on its 'next-generation' firewall and security platform, and also include software applications for various enterprise security needs. The company's founders include current Chief Technology Officer Nir Zuk, formerly of Checkpoint Software. The company shipped its first products in 2009 and completed its IPO in July 2012 at an initial share price of $42. Palo Alto executed a 3-for-1 stock split on September 13, 2022 through a two-share stock dividend. About 35% of the company's revenue is generated outside the U.S.