Growing sophistication of cyber-attacks and repeated attempts at high-profile hacking have kept countries around the globe alert over the past few years. A series of cyber-attacks like WannaCry or WannaCrypt ransomware attacks and Petya rocked the globe.
Moreover, the massive data breach at Equifax in September, and the Uber data theft in November last year reflected the loopholes in the security systems around the world.
The attacks continued this year affecting travel booking company Expedia’s subsidiary, Orbitz (orbitz.com) . In May, two of the largest Canadian banks reported a major hacking of personal and financial information of nearly 90,000 of their customers. The following month, Ukraine reported that it successfully warded off another sophisticated cyber-attack against a chlorine distribution plant.
The worrisome trend has not only gravely affected certain companies, but also threatened the national security of certain countries. A chief scientist from a leading cybersecurity firm assesses that the impact of a cyber-attack, which is difficult to contain within a nation, is bound to spread to other nations. Per the findings of Cisco, hackers have infected more than 500,000 routers and storage devices across 54 nations.
U.S. Midterm Elections Bring These Cybersecurity Stocks in Focus
Ever since the Ukraine power-grid hacking, which took place in 2015 and 2016, causing nationwide blackouts and factory shutdowns, and the discovery of Russian interference in the 2016 U.S. presidential elections, the matter of cybersecurity has been thrust into the national spotlight.
With the 2018 midterm elections knocking at the door, there are growing speculations that interference could take place this time as well. A group of suspect websites have been discovered, mimicking a portal used by U.S senators and urging them to reset their passwords via emails. Attempts at infiltration and social media manipulation indicate that Russia might still be interested to tamper with U.S. election procedures, even though there is no strong evidence yet.
Enterprises are realizing the need for stricter security measures, which will push companies to further increase spending on cyber security.
According to a research by Gartner, worldwide enterprise security spending is projected to total $96.3 billion in 2018, representing an 8% increase from 2017.
While growing cyber-attacks don’t bode well with most organizations, firms operating in the cybersecurity industry are positioned to benefit immensely.
Considering these factors, we’ve highlighted six cybersecurity stocks that are showing strong momentum going into the election season.
Cybersecurity Stocks in Focus as Hacking Threatens Elections: Fortinet Inc (FTNT)
Fortinet (NASDAQ:FTNT) is benefiting from strong global demand for its Security Fabric offerings due to digital transformation and security refresh cycle across most industries.
Moreover, Fortinet’s rich experience in the security space and continued delivery of mission-critical solutions will help it maintain and grow market share in the cyber security space.
Sporting a Zacks Rank #1 (Strong Buy), Fortinet delivered a trailing four-quarter average positive earnings surprise of 21.68%.
Moreover, the Zacks Consensus Estimate for fiscal 2018 improved 9.2% to $1.66 over the last 60 days. Shares of the firm have surged 123.7% in the past 12 months.
Cybersecurity Stocks in Focus as Hacking Threatens Elections: Radware Ltd. (RDWR)
Radware (NASDAQ:RDWR) is witnessing growth in product and services, as well as subscription revenues.
There was a significant improvement in bookings in its cloud offerings in its last reported quarter. It is also gaining traction in the hybrid security market.
Sporting a Zacks Rank #1, Radware delivered a trailing four-quarter average positive earnings surprise of 22.71%.
Moreover, the Zacks Consensus Estimate for fiscal 2018 improved 17.1% to 41 cents over the last 60 days. Shares of the firm have surged 56.5% in the past 12 months.
Cybersecurity Stocks in Focus as Hacking Threatens Elections: Proofpoint Inc (PFPT)
Proofpoint (NASDAQ:PFPT) is benefiting from its partnership with Palo Alto Networks, CyberArk, IBM, Imperva and Intel, aimed to provide best-in-class cyber security solutions to customers.
Its focus on launching new products like Domain Discover, and acquisitions of Cloudmark and Weblife.io have helped it report approximately 35% revenue growth for the last few quarters.
With a Zacks Rank #2 (Buy), Proofpoint delivered a trailing four-quarter average positive earnings surprise of 54.36%.
Moreover, the Zacks Consensus Estimate for fiscal 2018 improved 9.3% to $1.17 over the last 60 days.
Cybersecurity Stocks in Focus as Hacking Threatens Elections: FireEye Inc (FEYE)
FireEye (NASDAQ:FEYE) recently came into spotlight for its role in the uncovering of fake accounts on Facebook and Twitter, which were being used to propagate Iranian political interests.
It is also benefiting from its Network and Email Security products and revamped pricing policy. Going ahead, a healthy security market, strong product lineup, deal wins and investment plan positions the company well for long-term growth.
FireEye carries a Zacks Rank #3 (Hold). It delivered a trailing four-quarter average positive earnings surprise of 85.72%. Moreover, the Zacks Consensus Estimate for fiscal 2018 improved 50% to 3 cents over the last 60 days.
Cybersecurity Stocks in Focus as Hacking Threatens Elections: Palo Alto Networks Inc (PANW)
Palo Alto Networks (NYSE:PANW) is benefiting from a healthy demand environment, new product launches and increasing adoption of its next-generation security platforms.
We believe that its acquisitions and strategic partnerships will continue to boost growth.
Palo Alto carries a Zacks Rank #3. It has delivered a four-quarter average positive earnings surprise of 9.32%. Shares of the firm have surged 54.7% in the past 12 months.
Cybersecurity Stocks in Focus as Hacking Threatens Elections: CyberArk Software Ltd (CYBR)
Cyberark (NASDAQ:CYBR) is benefiting from its strategic acquisitions like Conjur and Vaultive.
CyberArk carries a Zacks Rank #3. It delivered a trailing four-quarter average positive earnings surprise of 38.79%.
Moreover, the Zacks Consensus Estimate for fiscal 2018 improved almost 9% to $1.46 over the last 60 days. Shares of the firm have surged 82.3% in the past 12 months.
Last year, it generated $8 billion in global revenues. By 2020, it’s predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce “the world’s first trillionaires,” but that should still leave plenty of money for regular investors who make the right trades early.