Tag: ZS

Have You Made Your Portfolio Safe with Cybersecurity Stocks?

by Fred Fuld III

Cybersecurity is becoming an increasingly important issue in our interconnected world, and as a result, the future business potential of cybersecurity is significant. Here are a few reasons why:

  1. Growing need for cybersecurity: As more and more of our personal and business lives move online, the need for robust cybersecurity measures will only increase. With cyber attacks becoming more sophisticated and frequent, companies will have to invest in cybersecurity solutions to protect their data and infrastructure.
  2. Compliance regulations: Governments around the world are introducing new regulations to ensure companies are taking adequate measures to protect their customers’ data. For example, the European Union’s General Data Protection Regulation (GDPR) and California’s Consumer Privacy Act (CCPA) both require companies to take steps to protect consumer data. This means that companies will need to invest in cybersecurity solutions to comply with these regulations.
  3. Increased spending on cybersecurity: According to a report by Cybersecurity Ventures, global spending on cybersecurity products and services is expected to exceed $1 trillion over the next five years. This represents a significant growth opportunity for cybersecurity companies and service providers.
  4. Cybersecurity skills shortage: There is currently a shortage of cybersecurity professionals, which means that companies are struggling to find and hire qualified individuals to help protect their networks and data. This presents an opportunity for companies to invest in training and developing their own cybersecurity teams, or partnering with third-party providers to fill the gap.

Overall, the future business potential of cybersecurity is significant, with increasing demand for cybersecurity solutions and a growing market for cybersecurity products and services. Companies that invest in cybersecurity now will be well-positioned to capitalize on this trend in the years to come.

So how does an investor play this market?

The following is a selection of the many stocks involved in cybersecurity:

CompanySymbolMarket CapP/EFwd P/E
Palo Alto NetworksPANW$56 B244040
FortinetFTNT$47 B5737
CrowdStrike HoldingsCRWD$29 B64
ZscalerZS$19 B62
PalantirPLTR$17 B35
OktaOKTA$13 B75
SentinelOneS$4 B
If a section is blank, it means negative earnings

Th largest by market capitalization is Palo Alto Networks, which is based in Santa Clara, California and has been around since 2005.

The stock has a nosebleed high trailing price to earnings ratio of 2440, but a more reasonable forward P/E of 40.

Earnings per share growth this year was 47.6%, and next year anticipated to be 16.25%. Quarterly earnings growth year-over-year was 180%.

The next largest is Fortinet, based in Sunnyvale, California. It trades at 57 times trailing earnings and 37 times forward earnings. Earnings per share this year jumped 46.6%.

Quarterly revenue growth year-over-year was up 33%. The company is debt free.

Hopefully one of these stocks can protect your portfolio.

Disclosure: Author owns PLTR.

Top Cybersecurity Stocks

by Fred Fuld III

It seems like every week, you hear about another cybersecurity breach. Just a couple weeks ago, there was a major issue at T-Mobile affecting over 40 million people.

The biggest tech companies, such as the FAANG stocks, are already spending a significant amount of money on fighting hackers. Microsoft (MSFT) and Google (GOOGL) are planning on spending $30 billion on cyber security during the next several years.

There are many companies in the cybersecurity industry that are helping out companies, organizations, and governments with protection against these cyber threats.

The following is a selection of cybersecurity stocks in no particular order.

Palantir (PLTR) offers cybersecurity software with three platforms Palantir Gotham for government agencies, Palantir Metropolis for banks and financial institutions, and Palantir Foundry other corporations. The stock has a forward price to earnings ratio of 169 and recently reported negative earnings.

Palo Alto Networks (PANW), which is actually based in Santa Clara, California, provides firewall appliances and cybersecurity software. The stock has a forward price to earnings ratio of 64 and recently reported negative earnings.

CrowdStrike (CRWD) is a provider of cloud-delivered solutions for endpoint and cloud workload protection in various countries around the world. The stock has a forward price to earnings ratio of 769. Earnings are negative.

Cloudflare (NET), based in San Francisco, is a provider of integrated cloud-based security solutions. Earnings are negative.

Check Point Software Technologies (CHKP), based in Israel, is a provider of products and services for IT security worldwide. Not only is this one of the few cybersecurity companies not based in California, it is also one of the few that is generating positive earnings. The stock trades at 20.5 time trailing earnings and 18.4 times forward earnings.

Fortinet (FTNT), based in Sunnyvale, provides integrated, and automated cybersecurity solutions worldwide. It is one of the other companies that generates earnings with a P/E of 100 and a forward P/E of 85.

Zscaler (ZS) is as a cloud security company based in San Jose. The stock has a forward P/E of 526.

Other security stocks include FireEye (FEYE), Mimecast (MIME), and several others.

Maybe one of these stocks will provide security to your stock portfolio.

 

Disclosure: Author owns PLTR.

20 Cybersecurity Stocks to Choose From

Doesn’t it seem like there is a  cybersecurity attack on a company almost every day? Because hacking and cyber attacks are such a big issue, the Securities and Exchange Commission issued stronger guidelines last year to to publicly traded companies regarding cybersecurity. The Equifax issue didn’t help.

Consumers are now worried about the Dark Web, which is a concealed Internet where supposedly anyone can buy any of the four H’s: heroin, hitmen, hackers, and harlots. The big money is in the marketing of email addresses, Social Security numbers, credit card numbers and other personal data.

Fortunately, there are companies that are working hard to prevent attacks on businesses and consumers.  There are 20 publicly traded companies that are involved in cybersecurity.

One of the biggest players in the industry is California based Symantec (SYMC), a cybersecurity provider for consumer and enterprise customers, which was founded in 1982. The stock has a trailing price to earnings ratio of 85 and a forward P/E of 13. It even pays a dividend of 1.3%. It has a market cap of $14.7 billion.

Another large cybersecurity firm is Palo Alto Networks (PANW), a California based company founded in 2012. The company provides network and endpoint cybersecurity solutions. The stock trades at 48 times forward earnings, however, earnings for the past few years have been negative. The market cap is $22.8 billion.

TRIVIA: 50% OF ALL PUBLICLY TRADED CYBERSECURITY COMPANIES ARE BASED IN CALIFORNIA

Checkpoint (CHKP) is an Israeli based network security company. The stock has a trailing price to earnings ratio of 24 and a forward P/E of 20. It does not pay a dividend.

There are several other smaller security companies to choose from including Tenable Holdings, Inc. (TENB), Okta, Inc. (OKTA), Carbon Black, Inc. (CBLK), and Zscaler, Inc. (ZS)

If you aren’t sure which cyber security stock to buy, maybe you should consider a cyber security ETF.  There are a couple to choose from, the ETFMG Prime Cyber Security ETF (HACK) and the First Trust NASDAQ Cybersecurity ETF (CIBR).

For a list of about 20 cybersecurity stocks, click HERE to access the stock list page.

Disclosure: Author didn’t own any of the above at the time the article was written.