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IBM Unit to Boost Cybersecurity with Agile 3 Solutions Buyout

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International Business Machines Corporation (IBM - Free Report) owned IBM Security has announced that the company intends to acquire privately-held data security firm, Agile 3 Solutions that develops software for senior executives and the C-Suite in particular to enable them to better visualize, comprehend and manage the risks to safeguard sensitive data.

Additionally, IBM announced that it also wants to acquire one of the subcontractors of Agile 3 Solutions called Ravy Technologies.

Following the acquisition, IBM Data Security Services will include Agile 3 Solutions’ technology. Also, Agile’s technology will be integrated into IBM Guardium, the leading data protection software. 

International Business Machines Corporation Price and Consensus

What Does this Mean for IBM?

In today’s world, growing cyber threats call for cybersecurity measures that can counteract the impending danger and secure sensitive information. Hence, it has become imperative on part of business leaders to improve their approach toward cybersecurity.

Agile 3 Solutions’ products offer a user-friendly dashboard as well as a data risk control center to discover, analyze and visually interpret the business risks related to the data.

Per an IDC report, worldwide spending on cybersecurity is estimated to be over $100 billion by 2020, up at a CAGR of 8.3%. Given the huge scope that the segment has to offer, the time seems ripe to invest in cybersecurity and that’s exactly what IBM is doing right now. The Agile deal marks the 20th security-related acquisition by IBM.

However, stiff competition persists in the space with the presence of Palo Alto Networks (PANW - Free Report) , Symantec and Trend Micro. Nevertheless, IBM's strategic growth initiatives, including its cognitive solutions, cloud computing, mobile and social business are expected to drive growth going ahead.

Stock Performance Overview

Notably, shares of IBM have underperformed the broader Zacks Computer-Integrated Systems industry over the last one year. While the broader industry gained 48.6%, IBM returned 40.1%.

The underperformance of the stock can be primarily attributed to time consuming transition to the cloud, weakness in traditional businesses, lower IT spending, integration risks and increasing competition.

Zacks Rank & a Key Pick

At present, IBM carries a Zacks Rank #3 (Hold).

A better-ranked stock in the broader technology space is Seagate Technology plc (STX - Free Report) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Notably, the consensus estimate for Seagate’s current year has improved to $3.80 from $3.78 over the last 30 days.

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