Why You Should Buy Cybersecurity Stocks & ETFs Now

Image: Bigstock

In this episode of ETF Spotlight, I speak with Dan Ives, Managing Director at Wedbush Securities and Stephen Gardner, Director of ETF Sales at ETFMG, about cybersecurity stocks.

The war in Ukraine remains front & center on investors’ minds.  Many cybersecurity experts have warned about the possibility of cyber retaliation by Russia to crippling financial sanctions imposed by the US and its allies. In fact, cyberattacks have been a part of Russia’s war strategy.

Several cyberattacks in recent years have been linked to Russian entities, including a high-profile ransomware attack on Colonial Pipeline last year. The country has significant cyber capabilities, and the government tolerates cyber crimes against other nations and foreign organizations.

Dan believes the sector, which was already poised to grow 20% year-over-year, could see 200 bps-300 bps of additional growth from the crisis.

Last week, Google (GOOG - Free Report) announced plans to buy cybersecurity firm Mandiant for about $5.4 billion. This would be one of its biggest acquisitions by Google if completed. The deal could drive further consolidation across the cybersecurity space as Amazon (AMZN - Free Report) and Microsoft (MSFT - Free Report) will be pressured to bolster their cloud platforms.

As our world is becoming increasingly digital and interconnected, the risk of security breaches and threats continues to increase, and we are likely to see increased demand for security products and services.

Dan’s favorite stock in the sector are Palo Alto Networks (PANW - Free Report), Zscaler (ZS - Free Report), CrowdStrike (CRWD - Free Report) CyberArk Software (CYBR - Free Report), Tenable (TENB - Free Report), and Check Point Software (CHKP - Free Report). We also discuss the outlook for broader tech.

The ETFMG Prime Cyber Security ETF (HACK - Free Report) invests in companies actively involved in providing cybersecurity technology and services.


Disclaimer: Neither Zacks Investment Research, Inc. nor its Information Providers can guarantee the accuracy, completeness, timeliness, or correct sequencing of any of the Information on the Web ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.