Software security stocks are on the move higher today following a cyber attack on Friday that is dubbed “WannaCry.” The hackers used a vulnerability in Microsoft software to take control of a corporation's IT system and require them to pay a ransom to get control back.
It should also be noted that President Trump also signed an executive order calling for increased cyber security lately. These events have pushed traders into these stocks and I see several names on the run today, but which ones should you focus on over the next few months for the best chance of making a few quick dollars?
Up The Least, Time To Feast
Most traders and investors know the phrase “a rising tide lifts all ships in the harbor” but few know the corollary. When you are a little late to the game it is hard to commit trading or investing dollars to a stock that has run up 7%, 8% or even 9% in a half of a trading day. So use the corollary of the “rising tide” idiom, “up the least, time to feast.”
The idea of “up the least, time to feast” says that the strong sector should continue to be that way, but traders that are late to the game are more likely to come after the stocks that have moved the least. In the cyber security stocks that are running today, Imperva (IMPV - Free Report) and Cyberark Software (CYBR - Free Report) are lagging the group… but that might not be the case for long.
Imperva (IMPV - Free Report) is a Zacks Rank #3 (Hold) but has the style score set up that I love to see. The stock has a Growth Style score of “A” and a Value Style Score of “F” and aggressive growth investors love to see that. Why do they love to see an “F” for value? Aggressive growth investors and value investors are looking for completely different things, so when I see the divergence I know that the growth investors will be behind me on this one. The value investors will be priced out of this stock for whichever reason they choose to hang their hats on, but they will wish they went for that growth down the road!
Cyberark Software (CYBR - Free Report) is a Zacks Rank #3 (Hold) and is coming off a quarter in which they beat the Wall Street estimate but guided the next quarter lower than the consensus estimate. That makes this one a little harder to swallow.
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Email Has The Answer
Proofpoint (PFPT - Free Report) reported a solid beat and raise quarter back on April 20 after the market closed and noted on the conference call that business email compromise attacks were up 45% on a year over year basis. This one is already up big, about 9%, but still could have room to run. This is also a Zacks Rank #3 (Hold) and has the A/F growth and value score set up I like to see.
Rapid7 (RPD - Free Report) is a stock that posted a solid beat after previously announcing that it would come in above the top end of the range for the quarter. This helped the analysts to move estimates higher into the report, which makes the beat that much more impressive. This is a Zacks Rank #2 (Buy) with a “B” for growth and an “F” for value.
Not My Tempo
Investors might feel a little whiplash on this play as it is in the cyber security basket of stocks, but shows a growth style score of “F” and that is decidedly not my tempo. VASCO Data Security (VDSI) is a Zacks Rank #2 (Buy) that beat the Wall Street estimate on April 27, but reported revenues came in lower than expected and were down 10% from the previous year. That isn’t something that I like but the near term move in earnings estimates suggests that things are improving.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
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