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4 Stocks to Watch as Need for Cybersecurity Grows

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The importance of cybersecurity has increased substantially over the past few years as the shift to digitization continues across the world, leading businesses and organizations to focus more on securing their data and information from malicious cyberattacks. Moreover, the outbreak of the COVID-19 pandemic last year accelerated the requirement for cybersecurity as the practice of social distancing norms called for a shift to a remote-working model. This meant that businesses and organizations had to be largely dependent on cloud-based services and remote servers for continuing their daily operations, which in turn, increased the risk of various cyber threats.

However, not only businesses but also governments are becoming increasingly dependent on cybersecurity as it has become a matter of national security. Notably, in December 2020, it came to light that SolarWinds, a technology firm in the United States, had been subject to a cybersecurity attack for months, leading to sensitive data of many corporates as well as government agencies being exposed.

On May 7, it was reported that the Colonial Pipeline in the United States, which is responsible for carrying close to half of the fuels that are supplied on the East Coast, had been subject to a ransomware attack, leading to a shutdown of its entire network. Notably, these incidents only go on to highlight the rising importance of cybersecurity for protection against such malicious hacking.

Meanwhile, besides corporates and government agencies, even individuals are being increasingly exposed to cyberattacks as their personal information is being hacked. This is because the shift to digitization has also meant that individuals now store their personal and financial details on cloud-based servers. This has led to increased threat of such information being hacked and sold online at the cost of the safety of the individual.

Reflective of these developments, a report by Grand View Research stated that the global cybersecurity market is expected to witness a CAGR of 10.9% from 2021 to 2028. Moreover, the report stated that the growth of the market will be driven by factors like the increasing sophistication of cyberattacks.

4 Stocks to Watch Out For

The rising threat of cyberattacks is making it necessary for businesses, organizations as well as governments to intensify their focus on cybersecurity measures, which should allow the cybersecurity market to grow going forward. Hence, this seems like a good time to look at companies that stand to benefit from this development. Notably, we have selected four such stocks that carry a Zacks Rank #2 (Buy) or 3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

NortonLifeLock Inc. (NLOK - Free Report) provides cyber safety solutions for consumers worldwide. The company offers Norton 360, an integrated platform that provides extensive cyber safety coverage while also offering Avira Security, a consumer-focused portfolio of cybersecurity and privacy solutions, among others. NortonLifeLock currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings increased 6.2% over the past 60 days. The company’s expected earnings growth rate for the current year is 18.1%.

Palo Alto Networks, Inc. (PANW - Free Report) provides cybersecurity platform solutions worldwide. The company currently has a Zacks Rank #3. The Zacks Consensus Estimate for its current-year earnings increased 2% over the past 60 days. The company’s expected earnings growth rate for the current year is 22.8%.

Zscaler, Inc. (ZS - Free Report) operates as a cloud security company worldwide. The company currently has a Zacks Rank #3. The Zacks Consensus Estimate for its current-year earnings increased 17.5% over the past 60 days. The company’s expected earnings growth rate for the current year is 95.8%.

CrowdStrike Holdings, Inc. (CRWD - Free Report) provides cloud-delivered solutions for endpoint and cloud workload protection. The company currently has a Zacks Rank #3. The Zacks Consensus Estimate for its next-year earnings increased 1.6% over the past 60 days. The company’s expected earnings growth rate for the current year is 11.1%.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

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