The cybersecurity sector is poised for tremendous growth over the next decade. With cybercrimes continuing to rise at a record pace, cybersecurity stocks represent a compelling long-term investment opportunity.
According to management consulting firm Mckinsey & Company, cybersecurity represents a $2 trillion market opportunity. In the wake of high-profile data breaches across various industries, organizations worldwide are spending more than $150 billion annually. Moreover, this figure is projected to grow with damages dismantling companies’ IT infrastructure.
The strong demand for cybersecurity solutions will allow many players to capitalize on this trend, especially due to the industry’s segmentation in areas such as cloud security, endpoint security, and threat detection. With global average data breach costs up 10% in 2024, cybersecurity protection will be at the forefront of organizations’ budgets.
Now, let’s unpack the three best cybersecurity stocks that look to have significant upside in the next half-decade.
Check Point Software (CHKP)
Check Point Software (NASDAQ:CHKP) is among the best-in-class cybersecurity stocks that deserve your attention in 2024. The company offers a wide range of cybersecurity solutions, including cloud security, endpoint security, firewalls, and threat detection.
Check Point is an early mover in the cybersecurity industry, operating in the space for more than three decades. It has been delivering cybersecurity solutions for its customers since the early 1990s, constantly pushing the boundaries of innovation.
Its flagship Infinity Platform is one of a kind, delivering full-stack cybersecurity solutions across networks, endpoints, cloud, mobiles, and email. Moreover, It also includes CloudGuard and ThreatCloud AI, leveraging AI-powered threat detection to secure multiple assets and workloads.
The company’s ability to cover all bases makes adopting its solutions seamless. In its latest quarterly results, revenue increased 7% from a year ago to $627 million. Further, security subscription revenues rose 14% to $272 million, with earnings per share up 3% to $1.74 per share. With customers embracing its AI-powered cloud security solutions, Check Point remains on track to outperform in the years ahead.
Qualys (QLYS)
Qualys (NASDAQ:QLYS) also has significant long-term growth potential. With a market capitalization of approximately $5.5 billion, the company has much catching up to do.
Qualys is a cybersecurity company specializing in cloud security and compliance-related solutions. The company’s flagship TruRisk platform is one of the market’s leading vulnerability management software solutions. Its capabilities are extremely diverse, with a proven ability to meet the needs of small, midsize and enterprise customers.
Its financial performance has been exceptional in the last several years. Qualys’ revenue, earnings, and free cash flow have risen substantially as the company continues to extend its solutions across multi-cloud environments. In the first quarter, revenue increased 12% from a year ago to $146 million. Additionally, earnings per share rose 35% to $1.05 per share, with operating cash flow up 28% to $85.5 million.
Qualys is one of the cybersecurity stocks that deserves your attention for investors looking for a leader in the cloud-security race.
CACI International (CACI)
CACI International (NYSE:CACI) is a cybersecurity company primarily operating in the intelligence and defense sectors. It delivers various solutions for its government and enterprise clients, including network security, multi-cloud security, and endpoint detection.
CACI International is an invaluable partner to various branches of the U.S. federal government. The company’s long-standing history of delivering cybersecurity and enterprise IT solutions has consistently grown its revenue and earnings over the last decade. Moreover, it has built trust with these agencies, allowing them to become repeat customers.
Currently, CACI’s business is booming due to rising global geopolitical tensions. This year, its new contract awards tally in the billions, with revenue and earnings growing by double digits. In the third quarter of fiscal 2024, revenue increased 11% from a year ago $1.94 billion. Additionally, earnings per share rose 18% to $5.13 per share, with new contract awards of $3.5 billion. With management raising its full-year fiscal 2024 guidance, the future looks extremely bright.
On the date of publication, Terel Miles 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.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
