7 of the Best Cybersecurity Stocks for 2022 to Buy Now

It is an alternative to the traditional approach to cybersecurity, which has focused on on-premise corporate networks. However, with $10 billion of revenue coming from that part of its business, MSFT stock is not one to be ignored. One reason for that is the company’s ability to integrate its security tools into its Office 365 software which is already based in the cloud. A sector that exemplified the highs and lows in 2021 was cybersecurity stocks. Many of these stocks were outperforming the broader market for a good part of the year.

To slow down hackers, more companies are focusing on internal security threats though a strategy known as Zero Trust. In addition, traditional security measures aim to keep the bad guys out of corporate networks. Further, network firewalls focus on intruders from the public internet. Also, Fortinet competes with Palo Alto Networks and others in the firewall security market.

• The company continues to see subscription revenue move higher and it is also growing its free cash flow.
• The company frequently assists government bodies and large corporations to investigate security breaches.
• The mid-cap company has enterprise customers in industries that include automotive, energy, finance, healthcare, oil and gas, and government.
• Corporate America has hiked tech spending on security aiming to protect intellectual property as well as consumer privacy.
• © 2023 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions.

Choosing the best cybersecurity stocks for your portfolio doesn’t require much of a changeup from the usual program. You’re looking for companies that are growing revenue and improving margins without piling on the debt. But keep in mind the nature of the cybersecurity industry, too — running with the hackers requires diligent work.

Zscaler, Inc. (NASDAQ:ZS)

Security services is pegged to be the largest segment within the cybersecurity market, while cloud security is forecast to experience the fastest growth. Three top-performing ETFs offer investors exposure to the growing cybersecurity market without tying their investment to single stock. The fund has been around since 2004 and has forex vs stocks which is more profitable averaged just over 13% annually in returns. Vanguard, whose founder, Jack Bogle, invented the index fund in 1976, doesn’t have a specific ETF solely focused on cybersecurity. It is a broad-based index of the U.S. technology sector and is full of cybersecurity companies and other large businesses involved in security in some form.

• However, at 15% down on a year-to-date basis, ATEN could be a discounted player, especially as cyber threats will likely only rise as a problematic issue.
• The company is highly diversified, with multiple product lines for consumers and for corporations.
• This means it can be difficult to determine which stocks to add to your portfolio.
• And as a result, S will likely keep showing up on these lists of the best cybersecurity stocks to buy for years to come.

CrowdStrike provides a wide range of solutions focused on real-time endpoint security, threat intelligence and cloud workload protection. And it’s a software-as-a-service (SaaS) company that is growing its earnings and revenue both sequentially and year-over-year. Cybersecurity is a growing industry with a projected CAGR of 9.63 percent between 2023 and 2028, according to Statista, to reach a market value of US$256.50 billion.

Cybersecurity ETFs

A relative newcomer, the Global X Cybersecurity ETF was launched in late 2019. It quickly attracted more than $1.1 billion in investor funds and has outperformed both First Trust and ETFMG since it launched. Given the growing demand for cybersecurity, it’s no surprise there are a number of ETF options to choose from.

CACI International (NYSE:CACI)

At the time of this writing, the top three holdings (which make up about 20% of the fund’s assets) are large tech companies Cisco Systems (CSCO -0.22%), Palo Alto Networks (PANW -0.32%), and Accenture (ACN 2.11%). The ETF is rebalanced quarterly and has an annual expense ratio of 0.6% ($6 in fees are deducted from the fund’s performance each year for every $1,000 invested). Fortinet High low indicator mt4 is a cybersecurity vendor that sells products, support, and services to small and midsize businesses, enterprises, and government entities. Its products include unified threat management appliances, firewalls, network security, and its security platform, Security Fabric. Services revenue is primarily from FortiGuard security subscriptions and FortiCare technical support.

Check Point Software Technologies Ltd. (NASDAQ:CHKP)

Zscaler got started with a software-as-a-service product designed for network protection in the modern cloud computing era, but it has since added new internet security and end-user monitoring products. End-user monitoring is increasing with so many people now working from home. And with global spending on cloud computing expected to exceed $1 trillion annually this decade, Zscaler is well-positioned goldminen to profit from a massive secular growth trend. Microsoft stock is up 50% in 2021 and a good bit of that growth is because of the company’s Teams collaboration software. However, the company continues to expand into other high-growth areas such as the metaverse. Nevertheless, MSFT stock is a solid buy for investors who have a lower risk tolerance but still want exposure to cybersecurity stocks.

You should do your own research to form your own opinion about any investment before jumping in. This tech sector addresses a growing need, presenting tremendous upside. It may be smart to consider investing in one of these artificial intelligence-oriented ETFs. The first denial-of-service (DoS) attack happened in 1988, from a code written by MIT graduate student Robert Morris. Morris’s computer worm tore through college computer systems, creating massive slowdowns and crippling the newborn internet.

In its brief existence, the iShares Cybersecurity and Tech ETF has underperformed other funds in the cybersecurity space. The cybersecurity industry is currently a multibillion market and is expected to grow to $270 billion and beyond by 2026. Plus, advances in AI development should speed up the efficiency and implementation of cybersecurity systems. Investing in cybersecurity firms seems like a slam dunk, but you still need to pick good companies. Like any market sector, the most profitable business models can still be sunk by bad management and excessive debt.

Top cybersecurity ETFs in 2023

It tracks the Nasdaq CTA Cybersecurity Index, made up of companies that focus on cybersecurity on the industrials and technology sectors. Each of the fund’s holdings must be classified as a cybersecurity company by the Consumer Technology Association, have a minimum market capitalization of $250 million, and meet certain liquidity requirements. The ETF’s three largest allocations are software, accounting for 45% of the portfolio, followed by IT services and communications equipment. To determine the best cybersecurity stocks to buy now, we studied industry analysis reports and identified key players operating in the space.

Both malware and non-malware attacks are covered via CrowdStrike’s cloud-delivered technologies in a lightweight solution. CrowdStrike is best-of-breed for endpoint security and response, and it deserves a spot on the top 10 list of cybersecurity stocks. Palo Alto Networks (PANW, $190.76) is one of the world’s largest providers of cybersecurity solutions. The company’s software and hardware allows for sophisticated network security, secure access service edge (SASE) and cloud security.

With this context in mind, let’s analyze the 15 best cybersecurity stocks to buy now. We took into account hedge fund sentiment, analysts’ ratings, long-term growth potential, and fundamentals while choosing these stocks. According to a report by Grand View Research, the global cybersecurity market was worth $184.93 billion in 2021.

It’s difficult to determine the “best” cybersecurity stock, as the performance of individual stocks can fluctuate based on various factors. However, past performance does not guarantee future success and investors should conduct thorough research and consider their investment goals and risk tolerance before making investment decisions. Investing in a cybersecurity ETF can be a good option for investors looking to diversify their portfolios and gain exposure to multiple cybersecurity companies. ETFs can provide a convenient and cost-effective way to invest in the cybersecurity industry, as they allow investors to track the performance of various companies through a single investment fund. However, like all investments, cybersecurity ETFs come with risks and considerations, and it’s essential to conduct thorough research and consult with a financial advisor before making any investment decisions. Advancements in technology are also expected to have a significant impact on the cybersecurity landscape.