Cybersecurity is one of the most important advanced technologies in the internet age, as well as for the impending web 3.0 and 5G technological ramp-ups. Criminals are on the lookout for weak links to launch an attack with the goal of stealing valuable information or funds from companies and individuals.
Cybersecurity stocks are moving up as businesses globally are on high alert due to the unprovoked Russian invasion of Ukraine, fearing that the war will spill over into cyberspace and Russian hackers will attack western companies.
An attack on a company can be costly, so rather than sitting back and waiting for an attack, businesses are actively investing in cybersecurity.
Picks for you
The following three companies are worth considering if you are looking to invest in the cybersecurity space.
1. Radware Ltd. (NASDAQ: RDWR)
On March 30th, 2022 the company introduced a state-of-the-art protection platform for DDoS attacks called DefensePro 800. This product represents the first Terabit DDoS Mitigation Platform, offering its clients the highest level of protection. With this offer, Radware owned up to being the global leader in cybersecurity for cloud and data centers.
Further sweetening the deal for investors Radware also announced that they’re going through with their stock buyback program which will authorize total repurchases at $97 million.
The stock is bounced off of its December 2021 resistance line trading slightly below the
20-50-200 Simple Moving Averages. If the stock moves aggressively above the SMAs the first resistance that the stock should test would be at $36.
Analysts have a strong buy on the stock predicting that for the next 12 months the average price of the stock could reach $39. This would represent a potential increase of 19.82% from the current trading price of $32.55.
2. Palo Alto Networks (NASDAQ: PANW)
Palo Alto’s three-platform strategy of network, cloud, and security automation makes this company a pure-play in the cybersecurity space. It is also currently the most valuable company measured by market cap in the sector.
After pursuing a more aggressive acquisitions strategy the company is currently stronger than ever enjoying a solid competitive moat over the opposition. In its most recent quarter, the company’s revenue increased by 30% year over year to $1.32 billion.
With such strong fundamentals and predictions of future growth, the stock has been performing wonderfully. Currently, the stock sits at all-time highs trading above all SMAs showing strength even during choppy trading days.
Wall Street loves the stock giving it a strong buy rating with predictions that in the next 12 months on average the stock should trade at a price of $629.45. This represents a potential increase of only 3% from the current price of $611.11. Bullish analysts see the price reaching $710 in the next 12 months.
3. Zscaler (NASDAQ: ZS)
Partnership with industry leaders such as Microsoft (NASDAQ: MSFT) and Amazon (NASDAQ: AMZN) make this company stand out. Along with the partnerships comes Zscaler’s platform which processes 160 billion transactions per day in over 185 countries.
The company ended the last quarter with an increase in annual recurring revenue (ARR) up 85% from a year ago. Expectations of an additional rise in revenue of 55-56% should ensure that the company will continue to grow.
The stock has been punished in the broad sell-off in growth stocks falling from its all-time highs from November of 2021. Currently, the stock is trading in a descending channel recently breaking above the 50 day SMA.
Analysts rank the company as a moderate buy seeing the average price of the stock for the next 12 months at $311.75. Potentially this would represent an increase of 26.62% from the current price of $246.21.
Safe in an unsafe world
As cloud computing and remote work became more popular companies began to invest more into cybersecurity, making it more or less an essential part of operations.
Demand for next-generation security software is high and will likely be strong in the future with more global digitalization.
With the anticipated growth of the cybersecurity space of 15% year-over-year or $1.75 trillion until 2025, the niche will most likely remain a hot space for investments.
Investors will be well placed if they keep an eye on this growing niche of the market where potential lucrative investments can be made.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
