Cybersecurity stocks have become increasingly popular with investors in recent years, due to the growth of the cybersecurity industry and its importance in protecting digital assets. Cybersecurity stocks can provide a great way to diversify a portfolio and invest in a sector that is expected to experience strong future growth.
To help investors understand the various opportunities associated with investing in cybersecurity stocks, this article will provide an overview of the different types of companies in the industry, examples of cybersecurity stocks, the benefits and risks associated with investing in them, and how to analyze a cybersecurity stock’s performance and valuation.
Below is a list of some of the biggest publicly traded cybersecurity companies.
|APDN||Applied DNA Sciences Inc||$1.04||-55.74%||13.4M|
|ARLO||Arlo Technologies Inc||$5.44||-38.67%||487.0M|
|CHKP||Check Point Software Technologies Ltd.||$128.37||-7.84%||16.6B|
|CRWD||Crowdstrike Holdings Inc||$131.04||-41.34%||30.9B|
|SPCB||SuperCom Ltd. Ordinary Shares||$1.55||-76.87%||5.5M|
|PANW||Palo Alto Networks Inc||$191.20||-7.81%||57.9B|
|CSCO||Cisco Systems Inc||$50.33||-7.65%||206.1B|
|CYBR||Cyberark Software Ltd||$143.02||-15.75%||5.9B|
|AKAM||Akamai Technologies, Inc.||$75.84||-35.39%||11.9B|
|CACI||CACI INTERNATIONAL INC Common Stock||$287.29||-5.97%||6.8B|
|SAIL||Steel Authority of India Ltd||$82.00||-20.47%||340.6B|
|SAIC||Science Applications International Corp||$103.27||13.70%||5.6B|
|CVLT||CommVault Systems, Inc.||$54.72||-16.75%||2.4B|
|TENB||Tenable Holdings Inc||$44.31||-24.48%||5.0B|
|JNPR||Juniper Networks, Inc.||$32.58||-8.64%||10.6B|
|LDOS||Leidos Holdings Inc||$91.14||-15.25%||12.5B|
|BAH||Booz Allen Hamilton Holding Corporation||$90.44||3.79%||12.0B|
|VRNS||Varonis Systems Inc||$25.65||-45.52%||2.8B|
|NTCT||NetScout Systems, Inc.||$28.15||-13.60%||2.0B|
|VRNT||Verint Systems Inc.||$35.91||-29.34%||2.4B|
|ATEN||A10 Networks Inc||$14.87||5.24%||1.1B|
About the Cybersecurity Industry
The cybersecurity industry is comprised of companies that develop and market technologies and services to protect digital information and assets from unauthorized access, malicious attacks, and other forms of cybercrime. The industry has grown significantly in recent years due to an increase in the number of cyber-attacks, as well as the emergence of new threats such as ransomware, data breaches, and phishing campaigns. As businesses become increasingly reliant on digital technologies, the need for cybersecurity solutions has grown, creating an opportunity for investors to gain exposure to the sector through investments in cybersecurity stocks.
The cybersecurity industry is also becoming increasingly important for governments and organizations around the world. Governments are investing heavily in cybersecurity solutions to protect their critical infrastructure and data, while organizations are investing in solutions to protect their networks and data from malicious actors. As the industry continues to grow, it is expected that the demand for cybersecurity solutions will continue to increase, creating more opportunities for investors to gain exposure to the sector.
Growth of the Cybersecurity Industry
The cybersecurity industry is expected to continue to experience strong growth in the coming years. According to market research firm Gartner, global spending on information security topped $124 billion in 2019 and is projected to reach $170 billion by 2022. As more businesses move their operations online, the need for robust cybersecurity solutions will continue to grow, providing an opportunity for investors to capitalize on the sector’s strong growth potential.
The demand for cybersecurity professionals is also expected to increase in the coming years. As businesses become increasingly reliant on digital technologies, the need for skilled professionals to protect their networks and data will become more important. Companies are already investing heavily in training and hiring cybersecurity professionals to ensure their networks are secure and their data is protected.
Different Types of Companies in the Cybersecurity Industry
The cybersecurity industry is comprised of a variety of companies that provide different types of products and services. These include companies that specialize in network security and data protection, as well as those that offer identity management and access control solutions. Additionally, there are many companies that provide consulting services and security testing solutions. Each type of company provides different solutions to address different types of cybersecurity threats.
In addition to the companies that specialize in cybersecurity, there are also companies that provide services related to the development and implementation of security policies and procedures. These companies help organizations create and maintain secure environments by providing guidance on best practices and helping to ensure compliance with applicable laws and regulations. Furthermore, there are companies that provide training and education services to help organizations stay up-to-date on the latest security trends and technologies.
Examples of Cybersecurity Stocks & What the Companies Do
There are several well-known publicly traded companies in the cybersecurity industry. These include cybersecurity leaders such as Symantec Corporation (SYMC), Palo Alto Networks (PANW), Check Point Software Technologies (CHKP), and FireEye (FEYE). Symantec provides a wide range of solutions including endpoint protection, email security, website security, and data loss prevention. Palo Alto Networks focuses on enterprise security solutions such as next-generation firewalls, advanced endpoint protection, and cloud security solutions. Check Point Software Technologies provides network security solutions including firewall, VPN, intrusion detection and prevention, and malware protection. Finally, FireEye offers a range of solutions including managed security services, email security solutions, and cyber-attack detection and response.
These companies are all leaders in the cybersecurity industry and have been providing innovative solutions to protect businesses and individuals from cyber threats. As the threat landscape continues to evolve, these companies are constantly developing new technologies and solutions to stay ahead of the curve. Investing in these companies can be a great way to gain exposure to the cybersecurity industry and benefit from the growth of the sector.
Benefits of Investing in Cybersecurity Companies
Investing in cybersecurity stocks can provide several benefits for investors. First, the sector is expected to continue to experience strong growth in the coming years due to an increase in the demand for robust cybersecurity solutions. Additionally, investing in cybersecurity stocks can provide an opportunity for investors to diversify their portfolio with a sector that is less vulnerable to economic downturns than other sectors.
Risks Associated With Investing in Cybersecurity Stocks
Investing in cybersecurity stocks can be risky. As with any sector, there are always potential risks associated with investing in stocks. This includes the risk of losing money if the stock price drops or if a company fails to meet expectations. Additionally, changes in technology can quickly render some products or services obsolete, making them less attractive investments.
Factors to Consider Before Investing in Cybersecurity Stocks
The development of technology calls for higher and better cybersecurity measures. This leads to a higher demand for cybersecurity companies and cybersecurity stocks.
Thus, the cybersecurity companies and their stocks are the hot investments for investors looking for high rewards. However, cybersecurity companies also need to spend a lot to maintain a robust infrastructure, reducing their overall gross profit margin. Therefore, cybersecurity companies have low-profit margins and high volatility.
Investors must also consider the number of customers and the mode of revenue generation of the cybersecurity companies to evaluate the cybersecurity stocks. The stocks of cybersecurity companies with a subscription-based revenue model are comparatively more stable and reliable in the long-term compared to the companies that offer support and professional services.
Analyzing the Performance of Cybersecurity Stocks
When analyzing a cybersecurity stock, it is important to look at past performance as well as future projections. Investors should look at how a company has performed over time and compare it to other companies in the industry. Additionally, investors should consider a company’s financials such as revenue growth, earnings per share, and cash flow metrics. All of these factors can provide insight into a company’s performance and help investors make an informed decision.
Analyzing the Valuation of Cybersecurity Stocks
It is also important for investors to analyze a company’s valuation when considering investing in a cybersecurity stock. This includes looking at metrics such as price-to-earnings ratio (P/E), price-to-book ratio (P/B), and price-to-sales ratio (P/S). Comparing these metrics to those of competitors can help determine if a stock is undervalued or overvalued.
Exploring the Future of Cybersecurity Investing
The future of cybersecurity investing looks bright. As businesses become increasingly reliant on digital technologies, the need for advanced cybersecurity solutions will continue to grow. This creates an opportunity for investors to capitalize on the sector’s strong growth potential through investments in cybersecurity stocks. By researching different stocks and understanding the risks associated with each one, investors can gain exposure to this growing sector and potentially generate returns.
Which Cybersecurity Stocks Should I Buy?
We have compiled a list of cybersecurity stocks to make it easier for you to choose which cybersecurity stocks to buy. The choice should depend on the company’s gross profit margin and future growth potential.
Cybersecurity stocks offer quick and high returns; however, they come with high-risk exposure. A growing cybersecurity company and its stock can get washed out in a go if it does not progress as fast as the technology and trends. Cybersecurity stocks also face stringent competition from stocks of companies in alternative technologies like cloud computing.