With COVID-19 massively altering how businesses are conducted and increasing dependence on technology, companies have become more prone to cyber-attacks. As remote working has taken over onsite working, with fewer security checks in place, enterprises are falling prey to cyber-crimes and data breaches. Online phishing, disruptive malware, bogus domains, fake news, and data harvesting malware have been some of the rampant forms of cyber-attacks. It’s deeply concerning to see the pace at which these crimes are rising.
Cybersecurity companies, thus, have an integral role to play here. These companies ensure the safety of their clients’ data and computing devices from any form of damage. According to Cybersecurity Ventures, global spending on information security will grow to $170.4 billion in 2022. The cybersecurity market is expected to grow 12-15% year-over-year through 2021.
So it’s no surprise that the stocks operating in the cybersecurity space are benefitting from this. Since the beginning of 2020, the First Trust NASDAQ Cybersecurity ETF (CIBR) climbed 25.2% compared to the against 8.8% returns of the SPDR S&P 500 Trust ETF (SPY).
Therefore, it’s prudent for investors to consider adding cybersecurity stocks to their portfolios from a possible second wave of COVID-19. But which ones? Today we’ll take a look at: Palo Alto Networks (PANW), Zscaler (ZS), Cloudflare (NET ), and Check Point Software Technologies Ltd. (CHKP).
Palo Alto Networks, Inc. (PANW)
PANW is an industry leader in cloud-based cybersecurity. The company deploys disruptive technologies like AI, automation, analytics to find solutions to the most complex security challenges. PANW has some of the most cutting-edge firewall products and services that counter hacks and data theft. The company isn’t just restricted to the fixed network, but also extends to mobile devices and the cloud. PANW focuses on giving access only to authorized users as per their requirements. The clients can also ask for customized offerings.
Earlier this week, the company unveiled the industry’s only comprehensive Cloud Native Security Platform (CNSP), Prisma™ Cloud 2.0. This platform includes four new cloud security modules such as data security, Web Application & API security, Identity-Based Microsegmentation, and Identity and Access Management (IAM) Security. By pioneering Prisma™ Cloud 2.0, PANW has placed itself a notch above its competitors. Recently, PANW has also been recognized as a Leader in the 2020 Gartner Magic Quadrant® for WAN Edge Infrastructure.
PANW’s revenue for the fourth quarter ended July 2020 climbed 18% year-over-year to $950.4 million. The billings for the quarter and the deferred revenue, both, increased 32%. The company’s net loss expanded to $0.61 compared to $0.22 in the prior-year period. For the first quarter of fiscal 2021, the consensus revenue estimate is $918.10 million, while EPS is expected to increase 26.7% to $0.31.
The stock has gained 10.8% year-to-date to close yesterday’s trading session at $256.10. PANW is inching closer to its 52-week high at $275.03, and an upbeat fourth-quarter result bolstered its market performance. The stock has gained nearly 36.2% in the last six months.
How does PANW stack up for the POWR Ratings?
A for Trade Grade
A for Buy & Hold Grade
B for Peer Grade
B for Industry Rank
A for Overall POWR Rating
The stock is also ranked #3 out of 23 stocks in the Software – Security industry.
Zscaler, Inc. (ZS)
A dominant player in the cyber security industry, ZS empowers its clients to work remotely without worrying about their data security. The company offers a secure workforce, app security, as well as safe customer access. ZS offers secure cloud transformation across industries such as household and personal care, apparel, diversified insurance, retail & food, beverages, etc. Conglomerates like Siemens, GE, FCC, and ABInBev form the niche customer base for ZS. Operating on an expansive scale, ZS handles 120 billion transactions per day and serves 185 countries.
In September, ZS extended its strategic partnership with VMWare to boost secure digital ere transformation. The collaboration of ZS with VMWare will enable…
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