Shares of tiny cybersecurity firm SuperCom (NASDAQ:SPCB) are up 10% today as the White House hones in on new threats.
So what do you need to know?
SuperCom is a small cybersecurity firm based in Israel. Its shares trade deep in penny stock territory, closing trading at just 69 cents. However, the stock had risen 24% year to date prior to today.
The gains today will put SPCB stock up more than 40% on the year as concerns mount about cyberattacks and online security breaches.
What Happened With SPCB Stock
Cybersecurity is top of mind after President Joe Biden warned U.S. companies to prepare for the possibility of cyberattacks by Russian hackers in response to economic sanctions imposed following the invasion of Ukraine. The president said intelligence reports indicate that Russia is “exploring” cyberattacks, but the U.S. would use “every tool” available to prevent and respond.
The American president called on U.S. companies to immediately “accelerate efforts to lock their digital doors.” At the same time, reports have surfaced that Okta (NASDAQ:OKTA) appears to have been targeted by hackers, putting customer data at risk. Several services at Apple (NASDAQ:AAPL), including its app store, suffered outages yesterday.
Why It Matters
Shares of leading cybersecurity firms have been rising since Russia invaded Ukraine as concerns over online breaches and hackers intensifies. CrowdStrike (NASDAQ:CRWD) stock has risen 27% in the last month, while shares of Palo Alto Networks (NASDAQ:PANW) have risen 22%.
SuperCom stock, while a smaller player in the cybersecurity space, is benefitting from the growing focus on preventing cyberattacks and hackers. As companies ramp up their spending on cybersecurity, stocks in the entire sector should continue to benefit, including SPCB stock, which is already up more than 20% this year.
What’s Next for SuperCom
With the threat of cyberattacks on the rise, SPCB stock and other cybersecurity plays are likely to continue rising in the near term. How long the gains last is a question mark. But demand for protection against hackers and online breaches is growing and likely to remain elevated as geopolitical tensions intensify.
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On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
