Cyber Security Stocks And What You Need To Know

Larry Davidson - February 21, 2018

On September 2017, investors were on the hunt for the best cybersecurity stocks.

The reason?

Equifax, one of the big three consumer credit reporting agencies, was hacked and potentially exposed over 143M consumers. Valuable information like social security numbers and driver’s license numbers were potentially exposed in the hack.

The “smarter” our technology gets the more exposure we have to hackers. That said, protection against these threats has become big business.

Demand for these services don’t just include businesses and consumers but also government.

Global spending on cyber security products and solutions will exceed $1T from 2017 to 2021, posting double digit growth year-after-year, according to a report from Cybersecurity Ventures.

With demand set to rise, its important that investors get familiar with the players in the cyber security space.

Top International Cyber Security Stocks

CyberArk Software Ltd. (NASD: CYBR)

This software security company  focuses on reducing the threat of cyber attacks. The firm is a security partner to over 3,500 global businesses. In fact,  more than 50% of the Fortune 100 rely on its expertise and experience to help protect their valuable information.

Its products include: privileged account security solutions; enterprise password vault; privileged session manager; privileged threat analytics; conjur; application identity manager; on-demand privileges manager; endpoint privilege manager.

In addition, the firm offers a number of solutions to its clients. They include: audit and compliance, security and risk management, security and compliance for federal agencies.

Based out of Israel, the firm has a market cap exceeding $1.5B and has been in business since 1999.

Check Point Software Technologies Ltd. (NASD: CHKP)

Recognized for creating the first consolidated security across networks, Check Point Infinity. The company believes a business should focus on prevention rather than detection only.

The firm breaks its products down into five categories: network, endpoint, cloud, mobile, and security management.

Network solutions include: advanced threat prevention, next generation firewall, ans security gateway appliances. Cloud solutions include: SaaS security, public IaaS security, and private IaaS Security.

Endpoint solutions include advanced threat prevention, protection, and remote access. Its security management solutions range from unified security management to event management. And its mobile solutions include mobile threat defense and a mobile secure work space.

This Israeli-based company has a market cap exceeding $15B, and been in business since 1993.

Top US-Based Cyber Security Stocks

Proofpoint, Inc. (NASD: PFPT)

Publicly traded cyber security stock since 2012, the firm breaks its products down into six categories.

They include: advanced threat protection; email protection; information protection; digital risk protection; archiving and compliance; and platform.

The company helps its customers by offering solutions to protect email, social and mobile applications. It’s advanced email security, as well as next generation compliance solutions is among the best in the industry.

More than half of the fortune 100 is a customer of Proofpoint. As well as the top five banks, and seven out of the top ten global retailers.

Palo Alto Networks (NYSE: PANW)

Founded in 2005, it has created a platform that’s aimed at reducing cyber security risk to a manageable level.

The Palo Alto Networks Next-Generation Security Platform uses these four characteristics to prevent cyber attacks: native integration; automation, extensibility and flexibility; and threat intelligence sharing.

Its product line includes: next-generation firewalls; threat detection and prevention, cloud security; panorama management; and advanced endpoint protection.

The company has more than 45K customers in over 150 countries across different industries. Over 85 of the Fortune 100 relies on its products and services.

FireEye, Inc. (NASD: FEYE)

Founded in 2004,  the firm believes its competitive advantage lies in its technology, intelligence and expertise.

It has over 5K customers across 67 countries, including more than 41% of the Forbes Global 2000.

The company offers products that help detect and prevent against cyber security attacks.

Some areas of focus include: network security; endpoint security; email security; threat analytics platform; and content security.

The firm has products that analyze and respond to cyber threats. Whether its forensics, malware analysis or endpoint forensics.

It offers solutions for data centers; ransomware; incident investigation; small and midsize businesses; enterprise networks; industrial systems and critical infrastructure.

Easy Way To Own The Best Cyber Security Stocks

ETFs offer the easiest way for an investor to gain exposure to cyber security stocks.

ETFMG Prime Cyber Security ETF (NYSE: HACK)

Is recognized as being the world’s first cyber security ETF. The ETF invests in companies that deal with hardware, software, consulting and other services used to defend against cyber threats.

The ETFs top five holdings as of February 20, 2018 are Qualys Inc, Proofpoint Inc, Akamai Technologies, Cisco Systems, and Fireye Inc.

The ETF has been around since 2014, and has net assets exceeding $1B.

Bottom Line

So much of our personal information is shared with corporations so cyber security is not an issue we can ignore. Experts agree that the space is growing fast.

We’ve recently seen a rise in interest in cryptocurrencies over the last couple of years. Of course, in order for them to gain more mainstream appeal, it will need to address the concerns people have surrounding it. Specifically, the fears of being hacked while storing or making transactions.

ETFs give you an easy way to gain exposure to the space. However, greater gains might be achievable if by investing in individual names. As always, make sure to do your own due diligence.

Larry D. is one of the most experienced writers at the Dork. His expert insights into the individual stocks have made small fortunes for some of his readers and profitable trades for many more. Best known for his work with under-the-radar growth stocks, Larry has been picking winners for over 30 years.

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