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Market Overview

Mounting Threats And Strong Sales Keep The Cybersecurity Industry Attractive

Mounting Threats And Strong Sales Keep The Cybersecurity Industry Attractive

The cybersecurity industry is coming off a decisive year for itself and the world at large. Not only did the pandemic drive companies across the world to invest in IT and cloud security to protect their remote workforce, but data breaches like those that impacted Marriott International, Inc. (NASDAQ: MAR) and T-Mobile US, Inc. (NASDAQ: TMUS) as well as the massive SolarWinds Inc. (NYSE: SWI) hack late in the year continued to reveal how high the stakes are for companies with sensitive data to protect.

The high-profile nature of these hacks put the value of the cybersecurity industry into stark relief and boosted the share price among some of the industry’s biggest names as traders gravitated toward companies offering these increasingly essential services.

For traders looking for technical insights among the cybersecurity stocks, research platform VantagePoint will be hosting a free demonstration of its software’s predictive tools and A.I.-enabled analytics. Prior to the virtual demo, let’s take a look at the earnings trend among the major constituents within the industry and how the sector has performed in light of those results.

Digital Urgency

Given the events of the past 12 tumultuous months, the cybersecurity industry has already generated a good deal of momentum leading into 2021.

Over the course of last year, stocks like CrowdStrike Holdings, Inc. (NASDAQ: CRWD) and Zscaler, Inc. (NASDAQ: ZS) grew by more than 200% as the market reacted to large-scale and highly-coordinated cyberattacks, many of which were found to be state-sponsored.

See the artificial intelligence for yourself in VantagePoint’s complimentary LIVE demonstration this week

This jump in share price could in part be chalked up to the reality of how dire the cyberattacks throughout 2020 were. In addition, the Biden administration’s pledge to increase federal IT and cybersecurity spending to the tune of $10 billion clearly illustrates the scale at which the nation’s digital infrastructure needs to be updated.

Revenues Rise In Spite Of Virus

Earnings season has only amplified interest in the space as traders turn to these companies’ fundamentals for a snapshot into just how strong the growth in the industry was over the past 12 tumultuous months. At the moment, reports from a decent swath of the cybersecurity industry have supported the enthusiastic price trends that have characterized stocks in the segment.

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Fourth-quarter results from FireEye, Inc. (NASDAQ: FEYE), CyberArk Software Ltd. (NASDAQ: CYBR), Fortinet, Inc. (NASDAQ: FTNT) and Cloudflare, Inc. (NYSE: NET) have all surpassed consensus analyst expectations. More than that, each and every one of those companies reported year-over-year revenue growth through a fiscal year in which most companies were happy to call a wash.
Incoming reports from Okta, Inc. (NASDAQ: OKTA) as well as the aforementioned Crowdstrike and Zscaler over the next few weeks promise to punctuate the industry’s apparent growth through 2020.


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Posted-In: vantagepointFintech Markets