Top 10 Cyber Security Companies to Invest In
It seems like every time you read the news there has been another cybersecurity breach resulting in people’s names and passwords being strewn all over the internet for everyone to see. If you have a different password for every online account you have, we’re genuinely impressed, but the truth is that most people just use one password for all their online accounts. Therefore, if you can get someone’s password for one site, you can then use that information to gain access to all the other sites they frequent.
Cybersecurity is a complex domain, and as investors, we’re not that interested in understanding it but rather finding ways that we can invest in this space. It’s only a matter of time before artificial intelligence makes security problems even more complex, and there are all kinds of companies both public and private that stand to benefit from an increasing demand for more sophisticated security solutions. We’ve made this task simple for retail investors by identifying 10 cybersecurity companies with market caps greater than $1 billion that you can invest in today. Here they are in order of size with the largest starting first.
Unless you work in IT, Symantec Corporation (NASDAQ:SYMC) is probably the only company you have heard of out of this entire list. With over 65 acquisitions, this $14 billion company operates in two areas of cybersecurity; Consumer Security and Enterprise Security. Symantec is the market leader in a total of seven segments of consumer and enterprise security-related avenues and took in over $3.6 billion in fiscal 2016 revenues.
Check Point Software Technologies Ltd.
Check Point Software Technologies Ltd. (NASDAQ:CHKP) is one of the largest pure-play security companies around, and according to Gartner, has the largest enterprise firewall market share. The Company sells their security solutions to over 100,000 different businesses. The founder and CEO of this Israeli company is credited with being the inventor of the firewall.
Palo Alto Networks Inc.
Palo Alto Networks Inc. (NYSE:PANW) offers a security platform which consists of three elements: its Next-Generation Firewall, its Advanced Endpoint Protection, and its Threat Intelligence Cloud. The Company has more than 34,000 customers in +140 countries with 1,000+ new customers added per quarter for the last 19 quarters. 2016 revenue was $1.4 billion, a 49% year-over-year increase. Investors who bought shares in PANW at the time of their 2012 IPO would have realized returns of over +170% to date.
With 2015 revenues of just over $1 billion, Fortinet Inc. (NASDAQ:FTNT) provides a network security hardware suite that is used by over 280,000 customers around the world. This profitable company has seen incredible revenue growth of 60% CAGR since 2002 and is now sitting on $1.2 billion in cash with no debt. Investors who bought shares in the company back when they had their IPO in 2009 would be sitting on gains of over +320% to date.
Proofpoint Inc. (NASDAQ:PFPT) offers a security-as-a-service platform consisting of a suite of on-demand data protection solutions that live in “the cloud“. Do you think we used enough buzzwords in that sentence? Essentially what this means is that these guys will keep your employees from sharing sensitive information via email or through social networks and their entire solution is on-demand and cloud-based so organizations of any size can use it without having to make expensive investments upfront.
Previously a subsidiary of Dell, SecureWorks Corp. (NASDAQ:SCWX) became the first tech IPO of 2016 when their shares began trading in April of this year. These guys help alert you if your organization is being subjected to a cyber attack through their five Counter Threat Operations Centers that process up to 180 billion cyber events daily. This early warning system helps make sure you don’t end up in the news as just another victim of a cybersecurity breach.
NetScout Systems Inc.
NetScout Systems Inc. (NASDAQ:NTCT) claims to have nearly everyone as a customer with all federal agencies and all top U.S. banks using their solutions. The company specializes in network performance management and is the number one leader in distributed denial of service (DDOS) prevention. In other words, there are bad people out there who can make your website unavailable by overloading it with requests and this company keeps that from happening.
FireEye Inc. (NASDAQ:FEYE) has invented a purpose-built, virtual machine-based security platform that provides real-time threat protection to enterprises and governments worldwide. The area of cybersecurity that FireEye is involved in is called “Specialized Threat Analysis and Protection (STAP) and apparently they’re a market leader in whatever that is with 7X the market share of their nearest competitor.
Founded in 2002, Imperva Inc. (NYSE:IMPV) had their IPO in 2011 and since then the shares have increased by +71% which is about the same return you would have realized by just investing in the S&P500. Gartner published their “2016 Magic Quadrant for Web Application Firewalls” and Imperva was the only leader they recognized for the third year in a row so the company must be doing something right.
Qualys Inc. (NASDAQ:QLYS) offers a cloud-based platform that lets you see all your global IT assets and assess their security risks and compliance. Essentially, you can look at a single dashboard and see how well protected you are across your entire organization no matter how many security vendors you use. Since it’s a SaaS solution, no upfront investment is needed and there is pricing available for just a single consultant all the way to an entire enterprise. Since their IPO in 2012, shares are up nearly +150% to date.
CyberArk Software Ltd.
CyberArk Software Ltd. (NASDAQ:CYBR) provides cybersecurity for an area called “privileged accounts. If you’re a Windows user, then you probably know what an “admin user” is. Essentially it’s an account that has permissions to do anything. That’s what you call a “privileged account” and if you’re a hacker, you want access to a privileged account so you can do some damage. CyberArk monitors privileged accounts internally and makes sure the bad guys don’t get a hold of them. The Company had an IPO in 2014 and since then their shares have increased by +74%.
Are we going to finally open a position in the Global X Cybersecurity ETF? Or did we go all hero-or-zero on CrowdStrike? Become a Nanalyze Premium subscriber and find out.