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4 Top Cybersecurity Stocks to Buy in April The Motley Fool

25 Jan

4 Top Cybersecurity Stocks to Buy in April The Motley Fool

by Nicholas Meyer
in Forex Trading
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That Cyber security stocks should ensure high net revenue retention rates, especially about a year into its new pricing. As a result, margins should start expanding again as the company continues to scale. The company competes against Broadcom, Cisco, Fortinet, Palo Alto Networks, and Zscaler in the rapidly expanding SASE market.

Cloudflare NYSE:NET

Meanwhile, revenue jumped 21% to nearly $1.2 billion, ahead of estimates. But good investors know that opportunities are created out of these threats when companies create the right tools to combat them. And that’s where Palo Alto Networks (PANW 0.09%), CrowdStrike (CRWD 0.04%), and Microsoft (MSFT -1.13%) come in.

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Look for firms with strong fundamentals, growth in revenue, and strategic positioning in emerging technologies. As a result of this rapid expansion, SentinelOne is also making steady progress toward turning a profit. It operates a cloud-based endpoint security platform, which puts it in direct competition with CrowdStrike.

CrowdStrike Holdings, Inc. provides cybersecurity solutions in the United States and internationally. Its unified platform offers cloud-delivered protection of endpoints, cloud workloads, identity, and data. It primarily sells subscriptions to its Falcon platform and cloud modules. The company was incorporated in 2011 and is headquartered in Austin, Texas. Akamai Technologies, Inc. provides cloud computing, security, and content delivery services in the United States and internationally.

  • Now, a year past the outage, CrowdStrike looks well positioned to grow again.
  • Morgan Stanley expects the $270 billion cybersecurity market to grow by about 12% a year over the next few years.
  • The company’s Q4 revenue of $2.54 billion beat Wall Street’s consensus estimate of $2.5 billion, and its earnings of $0.95 easily topped estimates of $0.88 for the quarter.
  • Palo Alto Networks has projected revenue growth of 13.6% for next year and 38.3% projected free cash flow margins, part of the reason that Morgan Stanley has an “Overweight” rating on the stock.

More Stock Ideas from MarketBeat

Below are the seven best-performing stocks in the Nasdaq CTA Cybersecurity Index that trade on major U.S. exchanges, ranked by one-year performance. We believe everyone should be able to make financial decisions with confidence. Enjoy a month of ad-free browsing, exclusive access to our in-depth report on the Trump tariff and nuclear energy company as well as the revolutionary AI-robotics company, and the upcoming issues of our Premium Readership Newsletter. This stock is so off-the-radar, so absurdly undervalued, that some of the most secretive hedge fund managers in the world have begun pitching it at closed-door investment summits. In fact, it’s sitting on a war chest of cash—equal to nearly one-third of its entire market cap.

Infrastructure monitoring and content delivery networks

In mid-December, the company declared that a quarterly cash dividend of US$0.12 per share will be paid to shareholders on February 14, 2025. In its Q financial report, Allot highlights revenues of US$23.2 million, up 5 percent over the previous quarter and up 3 percent year-on-year. This was led by growth in its SECaaS segment, which saw revenue of US$4.7 million, a 69 percent year-on-year jump. In recent weeks, the company has inked service agreements with key broadband providers, including Japan’s Asahi Net, Portugal’s MEO and British telecommunications firm Vodafone UK. For shares of CrowdStrike, which MS gives an “Equal Weight” rating, the bank sees 9% upside as a base case and 30% upside in its bull case. Its projected revenue growth is 21.5% and its projected free cash flow margin is 31%.

Infrastructure monitoring and CDNs

Our live streams are a great way to learn in a real-world environment, without the pressure and noise of trying to do it all yourself or listening to “Talking Heads” on social media or tv. However, the company’s recent investments in AI-led cybersecurity and constant progress in its other market segments make it a strong contender. Although cybersecurity is nowhere near Cisco’s largest market segment, it offers its clients a range of tools to protect them from data breaches. The following cyber security companies’ stocks have the greatest change in YOY EPS. This metric change indicates that the company produces money that can be invested or returned to shareholders. This result will push more hackers to find vulnerabilities in companies’ networks and systems to gain in a similar way.

  • Its Secure Access Service Edge (SASE) annual recurring revenue increased by 22% year over year in the most recent quarter, while its security operations platform grew by 35%.
  • Borg says the vulnerability management niche within cybersecurity may not provide the growth investors want to see from Rapid7.
  • On Morgan Stanley’s list of 15 software stocks to watch, two key drivers of forward returns are revenue growth (for long-term returns) and free-cash flow margins (for short-term performance), the bank said.
  • The company is increasingly using AI to reinforce its cybersecurity leadership and accelerate revenue growth.
  • Investors appreciate Elastic’s habit of beating earnings expectations.

Their sophisticated toos are leading the charge against cyber threats — and rewarding shareholders with significant gains. As of December 5, analysts remain divided in their ratings of FTNT shares. About 40% suggest the stock is a Buy, while 58% have rated it a Hold. However, it’s noteworthy that many of these ratings predate the company’s November 7 earnings report, which was viewed quite positively by the market (indeed, shares of FTNT have risen by 26% in the month leading to December 5).

In its 2024 fiscal year report for the period ended on September 30, Arqit reported revenue of US$293,000. Heading into 2025, the company is set to begin revenue generation through a multi-year enterprise license contract with a government end user, with annual recurring revenue totaling seven figures. In September, Arqit was named a 2024 International Data Corp (IDC) innovator for post-quantum cryptography, becoming one of only five vendors recognized by IDC for providing potential quantum cyberattack solutions. Like its subsidiary SEALSQ, WISeKey made announcements in December that attracted attention from investors. The company confirmed on December 13 that satellites from its subsidiary WISeSat.Space will be part of a January 2025 SpaceX satellite launch from the Vandenberg Space Force Base in California, US. The satellites are equipped with SEALSQ’s post-quantum chips and partner Hedera’s blockchain technology.

Palo Alto Networks: Strength in diversification

Here are four cybersecurity stocks I believe could be a great addition to your portfolio this April. Amid the historic stock market turbulence at the start of 2025, the importance of cybersecurity hasn’t wavered. While both companies are growing more slowly than CrowdStrike due to their legacy businesses, they’re each well positioned to grow at a solid pace as demand for one-stop cybersecurity solutions continues to grow. As such, either stock looks worth buying at the current price, especially when juxtaposed against CrowdStrike.

Most of the stocks here are pure-play cybersecurity stocks, but many companies operate in complementary industries such as aerospace and defense. Three of the stocks mentioned above are in its top five holdings. CrowdStrike’s stock price has gone from approximately $80 to $210/share(up 162%) in the past year.