Cybersecurity stocks surged in 2023 amid rising attacks

Cybersecurity stocks had a strong year in 2023 as prominent cyberattacks underscored the need for enterprises to have robust online security solutions.

According to Forbes, global cyberattacks are up 40% to 45%, with notable breaches this year including the ransomware attacks on Las Vegas hotel operators MGM Resorts and Caesars Entertainment and the release of 20 million user profiles from genetics research website 23andMe.

As such, business spending on cybersecurity solutions has grown, up 70% between 2019 and 2023 per a report by financial firm Moody’s.

Global cyber insurance premiums are expected to triple from $12 billion in 2023 to $27 billion in 2027, the report said.

Additionally, research firm Gartner expects to see corporate spending on cybersecurity increase by 14% in 2024 to $215 billion.

Here’s a look back at some of the top-performing cybersecurity companies of 2023 that are likely to continue to make gains in the new year amid further robust demand for advanced security software solutions.

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Palo Alto Networks

Santa Clara, California-based Palo Alto Networks Inc (NYSE:PANW)’s cybersecurity platform offers network security, cloud security, and endpoint protection, among other features.

This year the company introduced what it billed as the industry’s first artificial intelligence (AI)-powered Zero Trust management and operations solution Strata Cloud Manager and also unveiled five new Next-Generation Firewalls.

It made two acquisitions in 2023, Talon Cyber Security for $625 million and Dig Security for $400 million.

2023 share price gain: 114%

Market capitalization: $93.2 billion

Fortinet

Sunnyvale, California-based Fortinet is a direct competitor to Palo Alto Networks in the firewall security market.

The company also develops and sells a variety of security solutions including firewalls, endpoint security and intrusion detection systems.

2023 share price gain: 22%

Market capitalization: $45.4 billion

CrowdStrike

CrowdStrike is a leader in endpoint security, which is focused on securing the devices of endpoint users on a corporate network, such as laptops or mobile phones.

Its Falcon platform leverages machine learning and a proprietary database to detect malware and other threats.

2023 share price gain: 146%

Market capitalization: $61.6 billion

SentinelOne

SentinelOne also offers an endpoint security tool, ActiveEDR, which analyses endpoint data, network traffic, and user behavior to detect potential threats.

The Mountain View, California-based firm in 2023 acquired security advisory firm Krebs Stamos Group, which it has relaunched as a new entity named PinnacleOne.

2023 share price gain: 91%

Market capitalization: $8.3 billion

Qualys

Qualys offers a range of security and compliance solutions for businesses including asset management, vulnerability management, IT security, compliance, cloud-native Security, and web app security.

Founded in 1999, it was one of the first Software-as-a-Service (SaaS) security companies and it has partnerships with Amazon Web Services, Microsoft Azure, and Google Cloud.

2023 share price gain: 77%

Market capitalization: $7.3 billion

Cloudflare

Cloudflare offers content delivery network, cloud cybersecurity and distributed denial-of-service (DDoS) mitigation services.

It protects websites from comment spam, bot crawlers and more by acting as a reverse proxy open external link for customers’ web traffic.

2023 share price gain: 96%

Market capitalization: $28.3 billion

Zscaler

San Jose, California-based Zscaler Inc. (NASDAQ:ZS) offers enterprise cloud security services.

Among its suite of cybersecurity products is its Zero Trust Exchange Platform, which leverages zero trust architecture meaning that no user or application is inherently trusted.

2023 share price gain: 103%

Market capitalization: $33.3 billion

Datadog

New York-headquartered Datadog Inc (NASDAQ:DDOG) offers a monitoring and analytics solution for information technology professionals to monitor servers, databases and other tools for performance, errors, or threats.

It allows DevOps and security teams to collaborate and strengthen an enterprise’s security via its centralized view of all the relevant data.

2023 share price gain: 70%

Market capitalization: $40.4 billion

Okta

Okta Inc (NASDAQ:OKTA) offers customizable authentication and authorization services for an enterprise’s applications.

The cloud-based solution allows IT professionals to manage any employee’s access to an app or device and its Single Sign On (SSO) feature provides a seamless authentication experience for users.

2023 share price gain: 31%

Market capitalization: $15 billion

Microsoft

Microsoft Corporation (NASDAQ:MSFT) offers a range of cybersecurity solutions that are often bundled with its productivity tools – a draw for enterprise customers looking for a one-stop-shop.

This year, the company added an AI assistant called Copilot to its security products bundled with its Office 365 platform, which provides users with information about potential security threats. It launched on November 1.

2023 share price gain: 57%

Market capitalization: $2.8 trillion

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