Top Cybersecurity Stocks for Q4 2021

Cybersecurity companies provide services to protect electronic information from theft or damage. Businesses in the cybersecurity industry utilize both software and hardware to ensure that computing devices and data are not misused. The industry serves a broad array of customers including individuals, businesses, and government, among others. Some of the leading names in cybersecurity include Check Point Software Technologies Ltd. (CHKP) and NortonLifeLock Inc. (NLOK).

Cybersecurity stocks, represented by the First Trust NASDAQ Cybersecurity ETF (CIBR), have outperformed the broader market over the last year. CIBR has provided a total return of 49.4% compared to the benchmark iShares Russell 1000 ETF’s (IWB) total return of 35.7% over the past 12 months. These market performance figures and all statistics in the tables below are as of Sept. 9, 2021.

Here are the top 3 cybersecurity stocks with the best value, the fastest growth, and the most momentum. Note that the companies on our list are primarily pure-play cybersecurity companies, while CIBR includes a wider variety of related stocks in its portfolio.

These are the cybersecurity stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.

^{Source: YCharts}

• Ribbon Communications Inc.: Ribbon Communications provides network solutions for communications services providers and enterprises. It offers policy and routing servers, media and signaling gateways, cloud, mobility solutions, and more. The company announced in August that Tbaytel, the largest independently owned telecommunications provider in Canada, had selected key components from Ribbon’s fixed-voice core solutions suite to modernize its communications network.
• CACI International Inc.: CACI International is an information technology products and services company. It provides information assurance and security as well as systems integration, reengineering, electronic commerce, and related services. On Aug. 16, the company announced the launch of its new AVT CM62 Micro Gimbal multi-sensor imaging system. CACI International said that the product will have a “significant impact on survivability and resiliency” during military operations.
• Science Applications International Corp.: Science Applications International provides scientific, engineering, and technology applications as well as related consulting services. The company serves the security, environmental, health, and energy markets.

These are the top cybersecurity stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of over 2,500% were excluded as outliers.

^{Source: YCharts}

• Radware Ltd.: Radware is an American-Israeli cybersecurity and application company. It provides protection for data centers, applications, the public cloud and applications delivery. The company reported net income growth of more than 500% YOY on record revenue for Q2 2021 as it tripled new customer bookings.
• CrowdStrike Holdings Inc.: CrowdStrike Holdings is a holding company whose subsidiaries offer a cybersecurity platform that provides a range of products and services including endpoint security, cloud security, managed security services, threat intelligence, identity protection, log management, and more. CrowdStrike reported negative EPS for the most recent quarter, so a growth number could not be. calculated for the above table.
• Zscaler Inc.: Zscaler is a cloud-based information security company. It provides web and mobile security, threat protection, networking solutions, and cloud application visibility services to customers worldwide. The company reported widening net losses on rising revenue YOY for Q4 FY 2021, ended July 31, 2021. Revenue growth was driven by strong performance of its Zero Trust Exchange products. Zscaler reported negative EPS for the most recent quarter, making a YOY growth figure impossible to calculate.

These are the cybersecurity stocks that had the highest total return over the last 12 months.

^{Source: YCharts}

• Cloudflare Inc.: Cloudflare develops cybersecurity software solutions. It offers a global cloud platform that provides a range of services, including load balancing, video streaming, security, domain registration, and more. The company reported widening net losses despite 52.9% YOY revenue growth in Q2 2021. Cloudflare said that a record number of new large customers helped to drive revenue gains.
• Fortinet Inc.: Fortinet is a cybersecurity company serving enterprises, service providers, and government organizations worldwide. The company provides a broad, integrated suite of security technologies, including intrusion prevention (IPS), firewall, VPN, and antivirus.
• CrowdStrike Holdings Inc.: See above for company description.

The comments, opinions and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or to adopt any investment strategy. While we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described on our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.

View Article Origin Here