The top corporate cybersecurity trends are commonly inspired by a mixture of responses to leading cyber threats, new technologies, and long-term security goals. These are some of the top security trends and technologies defining the cybersecurity space in 2023. ETFs are designed to grow slowly over time and may offer dividends to supplement income from shares. That said, investing in cybersecurity ETFs should be part of a long-term plan. Most of its listed assets are software companies, but the fund also has considerable investment in IT services, communications equipment, and professional services.
Cloud environments enable rapid, DevOps development cycles and can eliminate the need for developers to maintain and secure the environments where their applications live. Additionally, the growth of the cloud has encouraged the use of containerization to ensure that applications can move freely between on-prem and various cloud environments. To solve this challenge, organizations are increasingly turning to hybrid mesh firewalls, which combine various types of firewalls into an integrated, centrally managed security architecture. The rise of AI has significant impacts on cybersecurity both from an offensive and defensive perspective. On the offensive side, ChatGPT and similar tools have already been used by cyber threat actors to streamline and improve cyberattacks with an across-the-board increase in attacks year-over-year. Thanks to this, the potential for the industry to grow from where it currently stands is astronomical.
- The rapidly growing cybersecurity industry focuses on protecting digital systems, networks and sensitive information from cyber threats.
- If legacy security is a castle with a wall and a moat, then zero-trust security acts more like a counterspy agency.
- NAV prices have fallen steadily since the end of 2021, presently 40% lower than two years ago.
- Moreover, recent trends have increased the firm’s clout and competitiveness within the industry, making now the perfect time for new investors to take advantage of this incredible investment opportunity.
- Cybercrime cost the United States $6.9 billion in 2021, and the trend shows no sign of slowing down.
She covers finance as well as real estate, technology, pop culture, and more. What makes NortonLifeLock different from many of the other stocks on this list is that they are consumer facing. Machine generated data is a crucial part of operations for many organizations. Many consider the stock to be undervalued at the moment, meaning there is potential for growth. They are an established company that works mainly with government agencies.
Trends in the Cybersecurity Sector
The list from eSecurity Planet features 20 privately held and publicly traded companies, as well as 22 honorable mentions across a range of stock exchanges. The firm employed criteria such as user reviews, product features and benefits, analyst reports, independent security tests and use cases to evaluate companies in the cybersecurity sector. Cybercrime is a growing concern, and it’s estimated that cyber criminals cost businesses US$10.3 billion in 2022.
Meanwhile, both computer security firms and hackers are expected to make use of generative AI tools. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. Volatility profiles based on trailing-three-year calculations of the standard deviation of service investment returns. According to the Identity Theft Resource Center, the number of data breaches set a new record in 2021, with the number of incidents jumping 68% from 2020 and up 23% from the previous high in 2017. The number of data compromise events remained near that all-time high in 2022, but the total number of individual victims that were affected soared almost 42% year-over-year in 2022.
The company features a solid balance sheet along with robust profitability metrics. A key highlight is Fortinet’s nearly 18% net margin, which is up from its median metric of 10% during the past 10 years. As well, it beats out the cybersecurity industry’s median net margin of 2.3%.
To bolster its network security offerings and protect its customers from ransomware attacks, Akamai acquired Israel-based Guardicore in 2021 and cloud infrastructure platform Linode in early 2022. Another legacy security software provider, Fortinet (FTNT -2.41%) is also one of the largest cybersecurity companies in the world by revenue and market cap. Like its peer Palo Alto Networks, it has maintained double-digit percentage growth and is highly profitable. But, unlike Palo Alto Networks’ acquisition spree, Fortinet has invested in its organic development of cloud security to remain competitive. Microsoft stock is up 50% in 2021 and a good bit of that growth is because of the company’s Teams collaboration software.
iShares Cybersecurity and Tech ETF (IHAK)
Threats keep becoming more sophisticated, requiring upgrades and additional offerings so investing in this industry seems like a solid bet. Using standard types of financial analysis, including looking at revenue and profit growth, levered free cash flow, debt levels and ratios like current ratio, quick ratio or cash ratio. In addition, given the changes in the industry, it’s important to find companies that have well-regarded technology and innovation. Look to trade publications, stories in business publications and customer reviews to find strengths and weaknesses. Even ten years ago, a company might typically need a handful of products, Koujalgi explains. The types of products needed to cover networks, connections to the Internet, servers, applications, mobile devices and traditional endpoints such as desktops and laptops has expanded to easily more than a dozen.
- This is more than two times the average for SaaS (software-as-a-service) companies.
- With this in mind and geopolitical tensions remaining elevated, cybersecurity stocks—particularly software-focused names—could be positioned to weather the macroeconomic storm and deliver strong growth.
- With demand for the company’s products and services remaining high, Fortinet is a solid buy for 2022 and beyond.
- Cybersecurity is a large chunk of the technology space, and every sector of the economy needs software to help keep data and critical systems secure.
- In this article we will take a look at the 15 best cybersecurity stocks to buy now.
Top holdings include Zscaler, Booz Allen Hamilton, Fortinet, Palo Alto Networks and Leidos. Products from one company will tend to have pre-existing integration, so there is less work to get everything to work together. That not only reduces up-front work but should in theory improve ongoing efficiency in protection. Also, investors might consider the Global X Cybersecurity ETF (BUG) for a more broad exposure to the sector. Corporate America has hiked tech spending on security aiming to protect intellectual property as well as consumer privacy. In addition, Rapid7 (RPD) and Qualys (QLYS)specialize in vulnerability management services.
With $4.8 billion of assets under management in early 2023, First Trust NASDAQ CEA Cybersecurity ETF (CIBR -1.07%) is the largest of its kind. The ETF is composed of 35 stocks in the cybersecurity industry and has an annual expense ratio of 0.6% (or $6 in annual fees for every $1,000 invested), making it an affordable option. A cloud-native software company, CrowdStrike Holdings (CRWD -1.51%) provides endpoint security — protection for devices such as laptops, PCs, and smartphones, and any other device connected to a network. Because it’s cloud-based, CrowdStrike is particularly well-suited for supporting remote work.
Check Point Software (NASDAQ:CHKP)
As the world becomes more connected, it’s almost inevitable that digital threats will increase. Check Point stays on top of the threat profile, making it a worthwhile contender. As well, because digital trends have basically encompassed many if not all facets of everyday life, that only opens the door for more nefarious activity. Therefore, buy cybersecurity stocks not only for their relevance but also because it’s just common sense. Many of the best cybersecurity stocks to buy have reported strong revenue this year despite the pandemic.
This type of identity management constantly requires verification of a user before allowing access to data and applications. If legacy security is a castle with a wall and a moat, then zero-trust security acts more like a counterspy agency. Cybersecurity stocks are a red-hot niche of the tech industry, so knowing how to invest in them can yield some big returns in the decade ahead. Okta is another one of the cybersecurity stocks I like because they have carved out a distinct niche. In this case, the company focuses on identity authentication with a “zero trust” approach. CrowdStrike is a good example of how cybersecurity stocks have given investors steep price movement in 2021.
With inflation in the U.S. remaining elevated, there is apossibility of more rate increases by the Federal Reserve, which also could hurt these stocksin the near term. These are the cybersecurity stocks with the highest total return over the past 12 months. Both sales and earnings are critical factors in the success of a company. Companies with quarterly EPS or revenue growth of over 1,000% were excluded as outliers. An intriguing catalyst for Fortinet is the company’s myriad financial strengths.
Top Cybersecurity Stocks for Q2 2023
Out of all cybersecurity stocks on the market right now, this one has had some of the most consistent momentum. Endpoint security products protect devices like computers and cell phones from cyber attacks. Many companies have been relying on cloud based technology for their day-to-day operations. This makes digital security more important than ever – and the best cybersecurity stocks are taking advantage of it.
Varonis Systems, Inc. (NASDAQ: VRNS)
This article looks at the best cybersecurity ETFs you can invest in right now. Regulation and compliance are expected to play a growing role in the cybersecurity landscape. Governments and regulatory bodies worldwide are increasingly focused on data privacy and security and are introducing live forex signals new laws and regulations to protect individuals and organizations from cyber threats. This will likely lead to greater accountability for companies that fail to meet cybersecurity standards and new opportunities for companies that can provide effective cybersecurity solutions.
For the most part, the growth prospects for cybersecurity stocks remain strong. Along with the rest of the technology sector, the cybersecurity industry has come under pressure. Since late 2021, shares of the Global X Cybersecurity ETF (BUG), which tracks a basket of cybersecurity stocks, have dropped from $35 to around $22 at present. Cybersecurity involves the protection of devices, data, and networks from external illegal access. Cybersecurity companies offer services and solutions to protect information and data from disruption. Other cybersecurity firms with a sizable government business include Tenable, Rapid7 and CyberArk (CYBR).
This has proven useful in detecting cybersecurity vulnerabilities in real-time. Even with the macroeconomic headwinds, CRWD has continued to grow at an impressive rate. In https://bigbostrade.com/ the fourth quarter, the company’s revenues jumped by 48% year-over-year to $637.4 million and cash flows were $273.3 million, up from $159.7 million from the year prior.
Today, the company offers an array of products for cloud security, endpoint security and security analytics. To address the cybersecurity skills shortage, Cisco offers certification programs for IT professionals. Investing in a cybersecurity ETF can be a good option for investors looking to diversify their portfolios and gain exposure to multiple cybersecurity companies.