Could These Top Cybersecurity Stocks Be Worth Adding To Your Portfolio?
Cybersecurity stocks have had a booming year in the stock market so far. This is simply due to the coronavirus pandemic forcing virtually all companies to focus on digital acceleration. In fact, Forbes projects that 83% of enterprise workloads will have moved to the cloud by the end of this year. Admittedly, the shift towards remote work is a risky but necessary process for companies in these times. This is because with more valuable company data being uploaded, businesses are more vulnerable than ever to cyberattacks.
As such, it would only be logical that this would lead to the growth of the cybersecurity industry. According to Grand View Research, the global cybersecurity market is expected to expand at a compound annual growth rate (CAGR) of 10% from 2020 to 2027. This sets up the $167 billion market to almost double in size to $326 billion in the next seven years. In light of this, veteran investors would likely be watching the best cybersecurity stocks that seem to have the potential for long-term growth.
Even in 2020, we can see that top cybersecurity stocks have flourished on the stock market. For example, Cloudflare (NET Stock Report) and Synopsys (SNPS Stock Report) have more than doubled in share prices since the stock market crash in March. Investors may be looking for entry points into the ever-growing industry. Given all of this, here is a list of top cybersecurity stocks for you to consider this month.
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Best Cybersecurity Stocks To Watch Right Now: CrowdStrike Holdings Inc
Right off the bat, we have CrowdStrike (CRWD Stock Report). This company is undoubtedly one of the big names in the cybersecurity industry. In short, this California-based company provides endpoint security, threat intelligence, and cyber-attack response services to customers. It has been in the limelight throughout 2020 as seen by its 186% rise in share price year-to-date. Most notably, it boasts a client list consisting of almost half of the Fortune 100.
The company gave investors something to think about with its impressive recent quarter fiscal released on December 2. CrowdStrike reported an 86% increase in revenue from the same quarter a year ago. Certainly, it owes this success to its 1186 net new subscribers in the quarter. These include 64 customers from the company’s earlier acquisition of Preempt Security. All in all, an 85% rise in customers year-over-year contributed to the company’s growth. Additionally, the company joined forces with the cloud computing platform ServiceNow (NOW Stock Report) to offer users improved security and IT operations outcomes. CrowdStrike does not seem to be slowing down any time soon.
In recent news, operational tech (OT) security company Claroty announced a massive collaboration with CrowdStrike. The deal will see the integration of the Claroty Platform and CrowdStrike’s Falcon platform. The integration allows customers to access their OT and information tech (IT) assets all on the Claroty Platform. Furthermore, it also provides enhanced threat detection across OT/IT boundaries without the need for any extra services. This results in more efficient OT/IT security governance and strengthened security posture across the board. Altogether, this could be an attractive offer for organizations looking to bolster their cybersecurity measures. Given all this, would you consider CRWD stock for your portfolio?
Best Cybersecurity Stocks To Watch Right Now: Okta Inc
Next up, we have Okta (OKTA Stock Report). Okta is an identity and access management company that is based in San Francisco. It provides cloud software that functions to help companies manage and secure user authentication into modern applications. Moreover, the company’s software is also aimed at developers looking to build identity controls into applications, web services, and devices. Okta offers six key services that are built on top of Amazon Web Services (AWS). Also, its other notable customers include JetBlue (JBLU Stock Report) and Nordstrom (JWN Stock Report).
Okta’s share prices are currently up by a massive 96% year-to-date as of Wednesday’s closing. In its most recent quarter fiscal released yesterday, the company reported a 42% increase in total revenue year-over-year. This is largely due to its subscription revenue growth of 43%. It saw a 27% increase in total customers within the same timeframe. Its current guidance indicates a 40% year-over-year growth in total revenue for its fiscal year 2021. No doubt, the company is confident about its current trajectory.
On December 2, the company announced the availability of the Okta Identity Cloud product line in the AWS Marketplace. With this, global Okta prospects are now able to quickly and seamlessly purchase the products in the AWS Marketplace. Generally, clients will also benefit from new integrations that take advantage of both Okta and AWS. This involves the AWS Control Tower which provides an easy and secure means of optimizing organization-wide identity management. Ultimately, this ongoing partnership with AWS will likely continue to benefit Okta. Overall, does this earn OKTA stock a spot on your watchlist?
Best Cybersecurity Stocks To Watch Right Now: Zscaler Inc
Finally, we have a cloud security company Zscaler (ZS Stock Report). The Zscaler Cloud Security Platform facilitates fast and secure policy-based access. In turn, this connects users to their desired cloud applications like Salesforce (CRM Stock Report) and Microsoft’s (MSFT Stock Report) Office 365. Impressively, Zscaler is responsible for securing more than one-fifth of the Forbes Global 2000 companies. Markedly, these companies are running some of the world’s most complex networks. Yet, they can confidently rely on Zscaler’s cloud-delivered security as a service. Accordingly, it is no wonder that the company’s shares have tripled in value year-to-date.
Financially, the company had a phenomenal run in the last quarter. It’s first-quarter fiscal released yesterday showed a 52% rise in revenue year-over-year. The company also reports a 308% year-over-year increase in net income. In particular, Zscaler cites its strategic partnership with cloud computing company VMware (VMW Stock Report) as the main contributor to these results. The collaboration serves to help organizations simplify the adoption of a complete Secure Access Service Edge (SASE) architecture and more effectively implement “Zero Trust” security. CEO Jay Chaudhry explained, “Our customers are accelerating their digital transformation, and this drove our strong first-quarter results.”
Meanwhile, network security policy platform FireMon recently announced plans to collaborate with Zscaler. This interaction involves the integration of the FireMon Security Manager (FSM) and Zscaler Internet Access (ZIA). The two will work together to further simplify the enterprise adoption of SASE. Crucially, this fits nicely into Zscaler’s current business model. Using FireMon Security Manager, customers can visualize and manage Zscaler Advanced Cloud Firewall policies through ZIA. This simplifies migration and ensures continuous visibility, control, and compliance across hybrid network environments. Could ZS stock skyrocket as companies continue to rely heavily on these services for digital acceleration?