Seeking (Cyber)Security in Uncertain Times
Cloud-based protection trends are accelerating, and moaty companies are positioned to reward investors.
For investors seeking both revenue growth and relative stability, cybersecurity has been a reprieve from the uncertainty of the global pandemic. The rise in remote working and distributed networking environments created a complex situation for security teams that we believe exposed holes in entities’ threat-prevention capabilities. Exacerbating the challenge, cyberattacks have grown exponentially in recent months, with the FBI reporting a 400% increase in complaints in April versus March, as attackers hope to expose weaknesses in an organization’s business continuity strategy. Also, data privacy laws have become much more punitive with regard to security missteps, and we do not expect any leeway amid a global pandemic.
Because of the rise of remote working, adoption of cloud-based security has accelerated, and we do not expect this trend to revert after workers return to offices. Before widespread shutdowns, these security solutions were gaining momentum because of technological efficacy and proximity to where data and threats were migrating. In our view, shutdowns caused IT teams to pivot their security solutions to trusted, more nascent cloud-based versions because of the ease of deployment, management, and protection for remote individuals and resources.
Mark Cash does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.