Why CyberSecurity Stocks Are Poised To Make Big Gains

With the ongoing assault on corporate and government computer networks and databases by hackers, cybersecurity stocks have a bright future that all investors should be aware of. The issue of cybersecurity came to the forefront once again with the announcement by healthcare insurer Anthem, Inc. (NYSE: ANTM) that hackers had compromised its computer security and had stolen both current and former customer’s personal data, including names, street addresses, email addresses, birthdays, social security numbers, as well as employment information.

Each cybersecurity attack raises the public’s awareness of this growing security problem and forces companies and government to commit more money to cybersecurity, which will bolster growth in revenue and earnings for cybersecurity stocks for years to come. President Barack Obama’s proposed 2016 budget requested $14 billion for cybersecurity to further protection for United States government computer networks and databases works against hacking threats. The budget seeks an increase of about $1.5 billion from this year’s $12.5 billion devoted to cybersecurity spending. This is especially critical now that it has come to light that some cybersecurity are coming from foreign governments.

It is not too late to get on board the cybersecurity stock train and ride it cybersecurity stocks to new heights. Yes, cybersecurity stocks have already begun to rally, but given the large scope of the cybersecurity problem and the vast amount of financial resources that will be committed to enhancing cybersecurity in coming years, cybersecurity stocks have a bright future. In 2015, more than $95 billion is expected to be spent on cybersecurity by public and private organizations seeking to protect their computer networks and data from hackers. Market research firm MarketsandMarkets estimates by 2019 cybersecurity spending will increase to more than $155 billion, which is approximately 63% more thane will be spent during 2015.

It is clear that there is still time to get long cybersecurity stocks and keep them in an investment portfolio to take advantage of the great amount of growth that lies ahead. Cybersecurity stocks will likely become takeover targets as well, as large technology companies look to bolster their growth rates through acquisitions of fast growing technology companies.

CyberSecurity Concerns Are Good For CyberSecurity Stocks

With each major cybersecurity breach, public concern over the security of personal data increases. Companies that are hit with break-ins of their computer networks and databases not only face public scorn, they also face tremendous costs associated with cleaning up the mess created by a cyber criminals. On top of all that, they also face lawsuits from weary consumers that seek restitution for their losses and for increased security to address the ongoing cybersecurity problem.

The reality is that in the modern world, personal information is very valuable, and companies and governments are going to spend tens of billions of dollars in coming years to upgrade their computer networks and databases and install additional security measures to thwart future cybersecurity attacks. Keeping computer networks and databases secure is also very important for the economy, since so much economic activity these days is done on computers. These two factors are going to drive spending on cybersecurity in coming years, and cybersecurity stocks are going to benefit greatly.

In fact, cybersecurity concerns are reaching the threshold where legislative and corporate boardroom actions may cause an explosion in spending on cybersecurity. This means good times are ahead for cybersecurity stocks. This will go beyond just issuing smart credit cards, as credit cards are just a small part of cybersecurity. The reality is that personal data on computer networks and databases is more valuable to cyber criminals than credit cards, which is going to drive a lot of revenue to companies that provide security solutions for computer networks and databases that hold personal data. It should also increase revenues for computer hardware and software makers, as a new round of hardware and software upgrades is likely to coincide with security upgrades. Consumers, business, and governments are likely to ramp up their spending on computer hardware and software, as well as cybersecurity protections, in coming years.

CyberSecurity Stocks and an Exchange Trade Fund To Invest In

The following are some of the publicly traded cybersecurity stocks that can be purchased to invest in the cybersecurity sector of the stock market.

• CACI International Inc. (NYSE: CACI) provides cyber security services that protect private and public computer networks from cyber security threats.
• Infoblox Inc. (NYSE: BLOX) develops, markets, and sells automated network control solutions worldwide. The company offers a product called Advanced DNS Protection that protects a computer network from cyber-attacks by using threat intelligence. It also offers a Domain Name Server (DNS) firewall that helps organizations protect against malware and cyber-attacks.

• Falconstor Software Inc. (NASDAQ: FALC) provides data and storage protection for business applications.
• FireEye Inc. (NASDAQ: FEYE) sells network protection products that protect computer networks from malware and other network threats.
• Fortinet Inc. (NASDAQ: FTNT) offers a network security platform that acts as a firewall to protect cloud-computing platforms.
• KEYW Holding Corp. (NASDAQ: KEYW) is heavily involved in providing defense, intelligence and national security agencies within the United States government critical network security solutions that enable them to secure their networks from cybersecurity threats. It also provides cybersecurity products for private enterprises.
• NQ Mobile Inc. (NYSE: NQ) sells security, privacy, and protection products for mobile devices, which is the fastest growing sector of the computer industry.
• Symantec Corp. (NASDAQ: SYMC) provides cybersecurity software for personal computers and corporate network computer systems.

If you prefer to spread your investments among numerous stocks within a stock sector, to reduce investment risk, the cybersecurity stock sector now has its own Exchange Traded Fund (ETF), which is known as The PureFunds ISE Cyber Security ETF (NYSE: HACK). The fund started trading during the fall of 2014. HACK invests in thirty stocks that do business in cybersecurity. The stocks range from micro-cap to large-cap stocks. The companies can be both inside and outside of the United States; however, most of HACK’s holdings are United States based cybersecurity stocks.

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