Doesn’t it seem like there is a cybersecurity attack on a company almost every day? Because hacking and cyber attacks are such a big issue, the Securities and Exchange Commission issued stronger guidelines last year to to publicly traded companies regarding cybersecurity. The Equifax issue didn’t help.
Consumers are now worried about the Dark Web, which is a concealed Internet where supposedly anyone can buy any of the four H’s: heroin, hitmen, hackers, and harlots. The big money is in the marketing of email addresses, Social Security numbers, credit card numbers and other personal data.
Fortunately, there are companies that are working hard to prevent attacks on businesses and consumers. There are 20 publicly traded companies that are involved in cybersecurity.
One of the biggest players in the industry is California based Symantec (SYMC), a cybersecurity provider for consumer and enterprise customers, which was founded in 1982. The stock has a trailing price to earnings ratio of 85 and a forward P/E of 13. It even pays a dividend of 1.3%. It has a market cap of $14.7 billion.
Another large cybersecurity firm is Palo Alto Networks (PANW), a California based company founded in 2012. The company provides network and endpoint cybersecurity solutions. The stock trades at 48 times forward earnings, however, earnings for the past few years have been negative. The market cap is $22.8 billion.
TRIVIA: 50% OF ALL PUBLICLY TRADED CYBERSECURITY COMPANIES ARE BASED IN CALIFORNIA
Checkpoint (CHKP) is an Israeli based network security company. The stock has a trailing price to earnings ratio of 24 and a forward P/E of 20. It does not pay a dividend.
There are several other smaller security companies to choose from including Tenable Holdings, Inc. (TENB), Okta, Inc. (OKTA), Carbon Black, Inc. (CBLK), and Zscaler, Inc. (ZS)
If you aren’t sure which cyber security stock to buy, maybe you should consider a cyber security ETF. There are a couple to choose from, the ETFMG Prime Cyber Security ETF (HACK) and the First Trust NASDAQ Cybersecurity ETF (CIBR).
For a list of about 20 cybersecurity stocks, click HERE to access the stock list page.
Disclosure: Author didn’t own any of the above at the time the article was written.