In an age of technological advancement and software development, deterring and thwarting cyber attacks is a priority. Enter cybersecurity firms. These companies are crucially provide protection for individuals and large corporations alike. If you’re looking to make the most of the growth ahead for cybersecurity stocks, here are three to consider analyzing and adding to your portfolio in 2024.
Varonis (VRNS)
Varonis Systems (NASDAQ:VRNS) stands out in the cybersecurity sector for providing cutting-edge data security solutions. These offerings position it as a reliable investment for portfolio protection in 2024.
Despite a slight $1 million decrease in total revenue, from $123.3 million in 2022 to $122.3 million in the third quarter of 2023, the company demonstrates resilience with notable highlights.
Subscription revenues increased from $96.1 million to $97.7 million, contributing to an impressive 16% year-over-year growth in Annual Recurring Revenues (ARR), totaling $517.5 million. Additionally, Varonis exhibited operational efficiency with a strong cash position of $731.5 million, generating $49.0 million in cash flow during the nine months ending on Sept. 30, 2023.
Notably, leadership has created strategic initiatives that underscore their commitment to staying at the forefront of the cybersecurity landscape. Some key recent initiatives include repurchasing shares, integrating with Salesforce Shield (NYSE:CRM) for advanced threat detection, and expanding globally with data centers in Canada and the United Kingdom.
A comprehensive development is Varonis’s full coverage for Microsoft 365 (NASDAQ:MSFT), effectively addressing the issue of email security. By extending their patented data classification technology to emails, attachments, and calendar events, Varonis enables organizations to proactively reduce their email attack surface, prevent data leakage, and mitigate the risk of generative artificial intelligence.
Varonis’s recognition as the recipient of the Most Outstanding Innovation in Data Security Posture Management (DSPM) award from Cyber Defense Magazine attests to the company’s innovative contributions to the cybersecurity field.
In my opinion, this cybersecurity stock is a clear winner for forward-thinking investors.
Cloudflare (NET)
Cloudflare, Inc. (NYSE:NET) is like the internet’s security personnel, keeping websites and applications safe. In the third quarter of 2023, they flexed their financial muscle with an impressive $335.6 million in total revenue, a 32% increase from the previous year.
Despite a minor hiccup in operating loss according to Generally Accepted Accounting Principles (GAAP), non-GAAP revenues showed a positive vibe at $42.5 million. It’s not just about money for them; they secured the sixth spot on the Fortune Future 50 list this year. The list highlights companies with serious long-term growth potential.
Cloudflare stood out in The Forrester Wave for Edge Development Platforms, Q4 2023, clinching the Leader title. With over a million developers working on Cloudflare, their Workers platform is like a magic wand for developers: facilitating scalability, protecting applications from cybercriminals, and keeping costs under control.
Even Microsoft Edge decided to team up, utilizing Cloudflare’s Privacy Proxy technology for its Edge Secure Network feature. Now, Edge users can browse the web like ninjas, keeping their online movements secret.
It’s not just about securing browser traffic: it’s about giving users a VIP pass to the internet with encryption, tracking prevention, and location privacy.
Akamai (AKAM)
Akamai Technologies (NASDAQ:AKAM), a key player in the online experience domain, has garnered attention as a cybersecurity gem for investment portfolios.
In the third quarter, the company reported impressive financial results, highlighting a 9% year-over-year increase in revenue with security and compute revenues accounting for 61% of the total. Encouragingly, earnings per share also experienced substantial growth, showcasing Akamai’s strong position in the market and its growth potential.
Further, the company’s commitment to innovation is evident through its its partnership with Hydrolix, offering TrafficPeak. This is an observability platform that provides real-time insights at a fraction of the cost of other solutions.
By collaborating with Deloitte, the company expanded their global security services and delivering zero trust microsegmentation and incident response services. This alliance addresses the growing threat of ransomware, providing immediate protection to organizations worldwide.
And finally, Akamai’s integration of DDoS protection capabilities with new filtering centers in Toronto and Montreal underscores its dedication to strengthening online defenses. These centers not only enhance security but also optimize operational costs and provide better visibility into region-specific DDoS attack patterns.
As of this writing, Gabriel Osorio-Mazzilli did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines