We recently compiled a list of the The 11 best cybersecurity stocks to buy according to Wall Street analysts. In this article we are going to look at where CyberArk Software Ltd. (NASDAQ:CYBR) ranks relative to the other best cybersecurity stocks to buy.
The widespread growth of Internet use has seamlessly integrated connectivity into the daily lives of individuals and businesses. This expansion has also created more opportunities for cybercriminals to commit financial thefts, compromise sensitive information and disrupt critical infrastructure. Despite progress in reducing response times to cyber risks, it still takes an average of 73 days for organizations to bring an incident under control. As organizations navigate an increasingly complex cyber threat landscape, it has become critical to stay ahead of emerging cybersecurity trends. Amid the increase in both the volume and sophistication of cyber attacks, global spending on cybersecurity products and services will reach $200 billion by 2024, a sharp increase from $140 billion in 2020, according to McKinsey. Furthermore, the cybersecurity market is expected to grow at an annual rate of 12.4% between 2024 and 2027, exceeding historical growth levels as organizations intensify efforts to counter evolving threats.
The rise of artificial intelligence also presents a double opportunity for cybersecurity prospects: securing AI systems and leveraging AI to strengthen security capabilities. These technologies improve threat detection, automate responses and enhance predictive analytics, enabling more proactive and efficient defense against increasingly sophisticated attacks. According to McKinsey, AI is broadening the scope of what is already a $2 trillion market opportunity for cybersecurity providers. The company further states that securing AI has become a distinct cybersecurity market segment, expected to grow from $122 million today to $255 million by 2027. Additionally, as more organizations shift their workloads from public cloud environments to private clouds , faced with new costs. increasing the achievable value for cybersecurity providers.
On the other hand, as AI technology continues to evolve, concerns around data privacy and risk management are escalating for both individuals and businesses. The World Economic Forum predicted earlier this year that advances in AI could push cyber incidents and data breaches to unprecedented levels by 2024, following a staggering 72% increase in breaches last year.
The return of newly elected President Donald Trump, coupled with his commitment to a more inward-looking foreign policy, is expected to bring new cyber threats, reduced regulation in most industry sectors and the possibility of business-friendly federal privacy legislation. However, the overall regulatory landscape will likely shift toward less emphasis on compliance and a greater focus on protecting critical infrastructure and technology companies, said Michael Bahar, co-leader of global cybersecurity and data privacy at Eversheds Sutherland.
“We will see – at the federal level – a deprioritization of cybersecurity regulation and cybersecurity enforcement. A very important exception is where cybersecurity intersects with trade policy and national security and technology. That’s actually where you’ll see an increase in cybersecurity. enforcement and at least a continuation of the regulatory environment.”
Experts expect cyber threats may evolve in response to shifts in foreign policy under the new administration. China in particular has become a major concern due to its cyber activities in the Asia-Pacific region, its opposition to US support for Taiwan’s democracy, and its defiance of international opposition to its extensive claims in the South China Sea.
Top 20 most valuable data companies in the world
A data center with a repetitive design of computer servers, showcasing the companies’ efficient and secure IT infrastructure.
To create our list of the best cybersecurity stocks to buy according to Wall Street analysts, we rated the holdings of the Global These stocks are ranked based on their average upside potential. , from low to high, based on price targets. We also included the number of hedge funds with stakes in these stocks, based on Insider Monkey’s third quarter hedge fund data.
Why do we care what hedge funds do? The reason is simple: our research shows that we can outperform the market by imitating the best stock picks from the best hedge funds. Our quarterly newsletter strategy selects 14 small- and large-cap stocks each quarter and has returned 275% since May 2014, beating the benchmark by 150 percentage points (see more details here).
Average increase for analysts: 8.70%
Number of hedge fund holders: 55
CyberArk Software Ltd. (NASDAQ:CYBR) is a leading cybersecurity company specializing in identity management. It helps organizations in industries such as financial services, energy, retail, healthcare and government protect sensitive assets by securing access to privileged accounts.
In October, CyberArk Software Ltd. completed (NASDAQ:CYBR) acquired Venafi, expanding its total addressable market by $10 billion to approximately $60 billion. This acquisition strengthens CyberArk’s leadership in identity security by integrating Venafi’s expertise in machine identity management. The collaboration enhances CyberArk’s security offerings and enables comprehensive solutions to protect machine identities, including workloads, applications and IoT devices.
On December 9, Jefferies raised its price target for CyberArk Software Ltd. (NASDAQ:CYBR) from $340 to $400, citing optimism about the 2025 outlook for annual recurring revenue (ARR) growth and the strategic impact of the Venafi acquisition. CyberArk’s 2025 ARR expectations, including Venafi, suggest 20% year-over-year growth, in line with the company’s projections. Jefferies expects the company to initially guide ARR growth in the low 20% range through 2025, with gradual acceleration throughout the year.
In the third quarter of 2024, CyberArk Software Ltd. (NASDAQ:CYBR) delivered strong financial results, achieving record revenue of $240.1 million, up 26% year over year. For the fourth quarter, the company expects revenue between $297 million and $303 million, beating the consensus estimate of $259.7 million. Additionally, non-GAAP operating income is projected between $43.5 million and $48.5 million.
Next Century Growth Small Cap Strategy stated the following regarding CyberArk Software Ltd. (NASDAQ:CYBR) in the first quarter of 2024 letter from an investor:
“CyberArk Software Ltd. (NASDAQ:CYBR) is a leading identity security platform that helps businesses protect against cyber attacks. CYBR specializes in privileged access management (PAM) and has a full suite of identity security products. As the sophistication of cyber attacks increases, companies of all sizes are needing to upgrade from legacy solutions such as SSO (single sign on) and MFA (multi-factor authentication), creating a strong demand environment for CYBR’s solutions. Given this end market backdrop, the company is growing revenue by >20% and achieving solid margin expansion.”
In short, CYBR is in 10th place on our list of the best cybersecurity stocks to buy according to Wall Street analysts. While we recognize CYBR’s potential, our belief lies in the belief that certain AI stocks hold greater promise for delivering higher returns in a shorter time frame. If you’re looking for an AI stock that’s more promising than CYBR but trades at less than five times earnings, check out our report on the cheapest AI stocks.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now AndThe 30 most important AI stocks according to BlackRock.
Disclosure: None. This article was originally published on Insider monkey.
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