The cybersecurity theme proved fairly resilient in 2023, up 36.42% in the past year through 5 January, according to Opto’s thematic ETF screener. Here is a collection of cybersecurity stocks to watch as the year progresses.
- CrowdStrike CEO George Kurtz has warned that generative AI will lead to a rise in cybercrime.
- OneSpan has announced an immediate leadership change as it bids to accelerate its transformation journey.
- Thales completed the $3.6bn acquisition of Imperva from Thoma Bravo in December.
Crowdstrike
The Generative AI Warning Stock
CrowdStrike [CRWD] CEO George Kurtz has warned that, despite its obvious benefits, generative artificial intelligence (AI) is inevitably going to lead to a rise in cybercrime in 2024. “The challenging part we have now is that it makes cyberattacks even more available to… folks that don’t have all the knowledge but can actually ask a generative AI technology to do something on [their] behalf,” Kurtz told Bloomberg last week. “Cybercrime is going to be even more prevalent than it is today,” he added. CrowdStrike shares are up 161.3% over the past 12 months.
Okta
The Cyber Hack Target Stock
Okta [OKTA] was the target of a hack in October, the company said on 29 November. Chief Security Officer David Bradbury explained in a blog post that the actor responsible had downloaded a report containing the names and addresses of all customer support system users. For 0.4% of users, the leak included sensitive personal data beyond a full name and email address. Okta has become a high-value target for hackers, given that its identity management products give business users access to a range of applications through a single sign-in.
OneSpan
The Leadership Change Stock
OneSpan [OSPN] announced a leadership change on 5 January: Victor Limongelli is taking over the reins from CEO from Matthew Moynahan, effective immediately. Limongelli was selected for his “track record of improved operational performance at each of the four software companies he has led, and this will be an important asset as we seek to accelerate the pace of our ongoing transformation efforts”, said Al Nietzel, Chair of the anti-fraud company’s board of directors, in a press release.
Thales
The Acquisition Stock
Thales [THLLY] wrapped up the $3.6bn acquisition of cybersecurity services provider Imperva from Thoma Bravo last month. The acquisition will create a cybersecurity giant that boasts 5,800 experts, while Thales’ digital security workforce in North America will grow by nearly a third. “Thales is now uniquely positioned to help customers protect the heart of their digital ecosystem: applications, data and identities,” Patrice Cain, CEO of the French technology company, said in a press release...
Infosys
The Contract Termination Stock
Infosys [INFY] revealed in a regulatory filing on 23 December that a deal to provide an unnamed multinational with “enhanced digital experiences, along with modernisation and business operations services, leveraging Infosys platforms and AI solutions” had fallen through. The contract would have been worth $1.5bn over 15 years. The Indian services giant announced large deals with a combined total contract value of $7.7bn in the quarter ended 30 September.
Another Way to Invest in Cybersecurity
The Global X Cybersecurity ETF
The Global X Cybersecutiy ETF [BUG] holds Crowdstrike, Okta and OneSpan as of 5 January. As of 31 December, information technology (IT) has a 94.2% weighting, with the other 5.8% allocated to communication services. The fund is up 37.4% in the past year through 8 January and up 17.9% in the past six months.
The First Trust Nasdaq Cybersecurity ETF [CIBR] holds all five stocks. Software currently accounts for 53.13% of the portfolio, while IT services and communications equipment have allocations of 15.3% and 13.2% respectively. Professional services, semiconductors and aerospace, and defence have single-digit weightings. The fund is up 36.1% in the past year and up 15.7% in the past six months.
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