Everyone wants to talk about healthcare, tech, cannabis, and crypto, but there’s a sleeping giant that’s already breaking loose early in 2022, and investors would be wise to jump on board before the rest of the marketplace catches wind.
We’re talking about cybersecurity – the booming billion-dollar industry that will only become more prominent in the years to come. There’s no doubt that this is the next big sector. The only question is, which companies and stocks will be leading the way?
Why Invest in the Cybersecurity Sector?
Cybersecurity, which refers to proactive protective measures businesses take to keep cybercriminals from stealing their assets, is experiencing more growth today than ever before. And as the world becomes an even more uncertain place with pandemics and wars, cybersecurity only becomes more integral.
“As we emerge from the global pandemic and return to robust economic growth, the cybersecurity industry is on fire and venture capitalists are taking notice,” VentureBeat explains. “While the industry has seen steady growth over the past decade, since 2019, industry expansion has accelerated at a breakneck pace.”
Increased interest in cybersecurity is being driven by the abundance of high-profile cyber attacks and breaches that have occurred over the past few years. This includes attacks against JBS (the world’s largest meatpacker), Colonial Pipeline, Steamship Authority of Massachusetts, and the Washington D.C. Metropolitan Police Department.
More recently, there’s an increased interest in cybersecurity due to the Russia-Ukraine war in which cyber attacks are playing out in real-time. Analyst Roger Boyd sees this as a critical moment for cybersecurity firms.
“We spoke with a handful of executives and experts that suggested a more targeted spending opportunity around bolstering monitoring capabilities, expanding threat intelligence, adding incident response capacity, and accelerating the deployment of solutions that can help protect critical infrastructure,” Boyd explains.
Gartner estimates that cybersecurity spending surpassed $150 billion in 2021 (a 12.4 year-over-year increase). According to Box, this is partially due to the 17 percent higher average cost per security breach that we saw in 2021 (and the highest in the past 17 years). As more people worked remotely, companies found it more difficult to stay protected.
4 Stocks Making Noise in 2022
As always, you must do your own research and get advice from multiple sources. But let this article serve as an “awareness” piece to put several stocks on your radar. At the very least, you need to know about them. Take a look:
1. Fortinet (FTNT)
This global cybersecurity company has a market cap of roughly $54.9 billion and one-year revenue growth of 29 percent. It offers both hardware solutions and cloud security services. And with high operating margins, the company produces better returns than some of its closest competitors (like Palo Alto). Analysts expect big things out of FTNT moving forward.
2. Palo Alto Networks (PANW)
Speaking of Palo Alto Networks, this industry giant has a market cap of $57.88 billion and has 30 percent one-year revenue growth. This company primarily works with large businesses and has over 1,000 seven-figures accounts. It has a number of platforms, including Stata, Prisma Cloud, and Cortex.
3. Check Point Software (CHKP)
With a market cap of $19.29 billion, Check Point Software is considerably smaller than some of the others on this list. However, it’s a mainstay in the industry. It was founded in 1993 and has since grown to be one of the most highly-respected names in the cybersecurity sector. Part of the company’s strength lies in its reach and diverse client base. CHKP boasts high-profile clients in Europe, the Middle East, Africa, the Americas, and Asia.
4. CrowdStrike Holdings (CRWD)
Coming in fourth on our list is CrowdStrike, which is a $46.12 billion company boasting astonishing 64 percent one-year revenue growth. The company’s platform is so respected that major corporations like Amazon Web Services and Google Cloud entrust their companies to CRWD.
Add Some Cybersecurity Exposure to Your Portfolio
Any proactive and balanced investment strategy needs to have cybersecurity exposure over the next decade. By spreading your resources out across multiple promising companies – possibly some of the ones mentioned above – you can benefit from the billions of dollars that are flowing through cybersecurity. Don’t miss the chance to get started!
