Recent disruptions to giants, including Facebook and Instagram, have resulted in a catastrophic $18 billion loss and amplified the need for strong cybersecurity. This spotlight on vulnerabilities has steered investor attention toward cybersecurity stocks, presenting a dual opportunity for long-term growth and stability amidst market uncertainty.
According to Statista, revenues from the cybersecurity space could rise to $78.3 billion by 2024. The trajectory foresees an impressive compound annual growth rate (CAGR) of 9.8% from 2024 to 2028, propelling the market to incredible heights.
Moreover, as the buzz around artificial intelligence (AI) continues to gain momentum, investor interest in cybersecurity solutions is amplifying. The anticipated boost in federal government spending in 2024 will further contribute to the sector’s growth. This injection of resources is expected to fuel the expansion of cybersecurity offerings, with numerous firms actively providing innovative safeguards for consumers and businesses alike.
Cybersecurity Stocks To Buy: CyberArk Software (CYBR)
CyberArk Software (NASDAQ:CYBR) is a leader in privileged access management (PAM). Its security solutions are critical in protecting accounts with access to sensitive information. Moreover, as digital infrastructures grow in complexity, the significance of CYBR’s role in securing privileged accounts becomes even more pronounced, positioning the company as a major player in the ongoing battle against cyber threats.
CyberArk’s financial triumph further underscores its positioning further, with an exceptional 36% year-over-year (YOY) surge in annual recurring revenues (ARR) during the fourth quarter (Q4), reaching an impressive $774 million. Notably, subscriptions experienced an exceptional 60% YOY growth, comprising a substantial 75% of the total ARR. This financial triumph, along with an enviable clientele that includes 55% of Fortune 500 companies, underscores the robustness of CyberArk’s solutions.
Its stellar trajectory hasn’t gone unnoticed, resulting in a ‘strong buy’ rating from TipRanks analysts with a projected 10% upside, indicative of its lucrative future in digital security.
CrowdStrike (CRWD)
CrowdStrike (NASDAQ:CRWD), a front-runner in cloud-native endpoint security, offers a strategic blend of advanced threat protection, endpoint detection and response (EDR), and threat intelligence services. This comprehensive approach positions CRWD as one of the top cybersecurity plays offering tremendous long-term upside.
Moreover, the company’s pioneering model has led to a significant boost in ARR. It’s grown from $1.73 billion in Q4 2022 to a whopping $3.44 billion in Q4 2024. Subscription revenue itself soared by 33% annually, clocking in at $795.9 million. This outstanding performance has translated into an astounding 61.8% upswing in CRWD stock price over the past three years, surpassing the broader market’s advances. Such accomplishments are linked to the company’s success in both widening its customer base and refining its subscription services.
Further sustaining investor confidence, TipRanks analysts assign CRWD a ‘strong buy’ rating and estimate an enticing 21.6% upside. This optimistic outlook reflects a collective belief in CrowdStrike’s capacity to sustain its growth trajectory in the evolving cybersecurity domain.
Zscaler (ZS)
Zscaler (NASDAQ:ZS) is revolutionizing cloud-based security, emerging as a top-tier player in the defense of digital assets for businesses. Its advanced platform, reinforced by a distinctive software architecture, has won the confidence of over 7,700 clients. They notably include industry heavyweights contributing over $1 million in ARR.
Impressively, Zscaler’s financial achievements in the second quarter (Q2) of fiscal year 2024 underscore its powerful positioning. It delivered a healthy 35% YOY increase in revenue reaching $525 million. This surge is further highlighted by a more than 50% bump in operating profit and a record cash flow. That showcases Zscaler’s edge in operational efficiency. Consequently, its free cash flow margin YOY exceeds the 32% mark, beating the sector median by 259%.
Furthermore, Zscaler made a strategic leap by introducing AI-powered analytics, aiming to refine employee experiences and reduce cyber threats. This cutting-edge innovation promises to bolster digital engagement and provide comprehensive cybersecurity evaluations. The deployment of AI in Zscaler’s solutions promises to boost sales and widen its customer base. It marks a significant step towards future growth.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines
