Cybersecurity is gaining prominence due to the rising number of ransomware attacks in 2021. Notably, ransomware infects a computer to encrypt files or systems. Typically, the victim has to cough up a ransom amount for data retrieval.
The latest victim is software vendor Kaseya and the ransomware attack on it has reportedly affected 800-1500 businesses globally. Kaseya’s IT management solutions are used by local and state governments, and agencies as well as small- and medium-sized businesses globally. Per Reuters, the ransomware attack forced hundreds of Supermarkets to close operations due to inoperative cash registers in Sweden, while schools and kindergartens went offline in New Zealand. Markedly, the U.S. President Joe Biden on Jul 3 said that his administration is not certain about the identity of the hackers. However, federal agencies have been directed to look into the matter. Reportedly, REvil has taken responsibility for the attack and demanded $70 million to restore data. This is the same group that attacked meat supplier JBS USA in May, crippling its North American and Australian IT systems. JBS USA paid $11 million as ransom, which, per Bloomberg, was in bitcoin. Another notable ransomware attack in the same month was on the Colonial Pipeline, which operates the largest fuel pipeline in the United States. The company reportedly paid $5 million ransom to hacker group DarkSide to restore services. Ransomware to Hurt More, Attack Rate to Increase
The number of ransomware attacks has grown at an alarming rate and is expected to be more than 65,000 this year, which is “a conservative number” according to John Chambers, former CEO of
Cisco ( CSCO Quick Quote CSCO - Free Report) and founder of JC2 Ventures. He estimates almost 100,000 attacks in 2021, with each one costing companies $170,000 on average. Moreover, according to Sophos, the average cost of a ransomware attack has increased from an average of $761,106 in 2020 to $1.85 million in 2021. In addition, the number of organizations that paid the ransom increased from 26% in 2020 to 32% in 2021, although only 8% managed to get back all of their data. Further, according to Cybersecurity Ventures’ latest projections, ransomware attack damage costs will be roughly $265 billion annually by 2031 compared with an estimated $20 billion in 2021. Additionally, frequency of ransomware attack is projected to increase to every two seconds compared with every 11 seconds in 2021. Growing Number of DDoS Attacks: A Key Concern
Apart from ransomware, growing number of distributed denial of service (DDoS) attacks has been a major concern.
According to F5 Networks data, between January 2020 and March 2021, DDoS attacks increased 55% and complexity increased with 54% incidents using multiple attack vectors. Markedly, the technology sector was the most targeted, receiving 27% of all DDoS attacks in the past 15 months. Cybersecurity Spending to Aid Prospects
Per Gartner’s latest projections, spending on information security and risk management technology and services is likely to
increase 12.4% to hit $150.4 billion in 2021 against growth of 6.4% in 2020. Spending on cloud security is estimated to grow the fastest, followed by data security. Besides, cybersecurity has been identified as the top priority for new spending, according to Gartner’s 2021 CIO Agenda survey. Here we discuss three stocks that are anticipated to benefit from an increase in cybersecurity spending to thwart ransomware and DDoS attacks. Palo Alto Networks ( PANW Quick Quote PANW - Free Report) : This Zacks Rank #2 (Buy) stock has been benefiting from continued deal wins and increasing adoption of its next-generation security platforms, attributable to the rise in remote work environment and need for stronger security. You can see . the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here The company is currently focused on cloud-based protection services. Palo Alto Networks has taken various key steps to address the need for integrated security, as more and more organizations are shifting to the cloud. The Prisma Cloud platform has been largely successful, boasting more than 1,800 customers, including 70% of the Fortune 100. The Zacks Consensus Estimate for fiscal 2021 is currently pegged at $5.99 per share, up 2% over the past 60 days.
CrowdStrike Holdings ( CRWD Quick Quote CRWD - Free Report) : This Zacks Rank #3 (Hold) company is riding on portfolio strength, mainly the Falcon platform’s 10 cloud modules. Furthermore, the company’s next-generation antivirus, EDR, and device-control products are well poised to gain amid the thriving remote work culture. Additionally, acquisitions have played an important part in driving its growth trajectory. The buyout of high-performance cloud log management technology provider, Humio, has fortified its Extended Detection and Response (XDR) capabilities. Further, Preempt Security’s acquisition boosts CrowdStrike’s Zero Trust security capabilities. It also fortifies the company’s Falcon platform’s capabilities to offer protection against identity-based attacks and insider threats. The Zacks Consensus Estimate for fiscal 2022 currently stands at 40 cents per share, having moved 29% north over the past 60 days.
Another Zacks Rank #3 stock,
Zscaler’s ( ZS Quick Quote ZS - Free Report) efforts to strengthen its cloud security capabilities, amid the remote-working wave and digital transformations, are driving growth. The launch of Zscaler Cloud Protection, a portfolio of solutions that enhances protection for cloud workloads on any cloud platform, is a key catalyst. Apart from this, Zscaler’s Zero Trust Exchange platform detects the most sophisticated attacks, ransomware, and other unethical movements in the cloud. Also, the company’s Edge cloud for policy enforcement, multi-tenancy, proxy for SSL or TLS inspection and zero-trust network access is well poised to gain adoption amid the thriving remote work culture. The consensus mark for fiscal 2021 currently stands at 47 cents per share, up 17.5% over the past 60 days.
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