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The Russian Conflict Is Boosting Cybersecurity Stocks

The Russian Conflict Is Boosting Cybersecurity Stocks

Global tensions with Russia have continued to escalate.

Countries around the world are placing sanctions on Russia that could break its financial system.

Several Russian banks have been removed from the SWIFT banking system. This will disrupt Russia’s ability to trade and make payments.

In addition, there’s a push to freeze Russian central bank assets held abroad. This will limit Russia’s access to capital.

As a result, the Russian ruble lost half its value at one point.

This is bad for Russia. But it’s creating a HUGE opportunity in cybersecurity stocks.

Prepare for More Russian Cyberattacks

U.S. officials expect Russia to retaliate by ramping up its cyberwarfare.

We’ve already seen Russia’s cyberattacks several times in the past.

In 2020, Russians hacked a major IT company, SolarWinds.

They planted malicious code that was pushed to SolarWinds’ customers.

This allowed Russia to spy on them and obtain sensitive data.

In 2021, Russians hacked Colonial Pipeline. This shut down one of the largest U.S. fuel pipelines for nearly a week.

The Colonial Pipeline delivers 45% of the East Coast’s gas, so 11 states saw shortages.

Gas stations and Americans were left without gas.

And Russia is likely looking to deploy cyberattacks again.

I Expect Spending on Cybersecurity Will Skyrocket

Russia already hacked the Ukraine’s government last week.

Companies and governments around the world are preparing for more attacks.

With Russia in the spotlight, I expect spending on cybersecurity tools will skyrocket.

This will boost earnings for cybersecurity companies.

Cybersecurity is more than a $200 billion market and was already poised for growth before the Russian invasion.

Forecasts have spending on cybersecurity reaching $345 billion within five years.

Cybersecurity Market Chart

(Source: MarketsAndMarkets.)

Despite blossoming into a huge market, cybersecurity stocks are down nearly 30% since November.

This is due to weakness in the tech sector across the board.

If you’re invested in cybersecurity stocks already, you shouldn’t panic.

The recent pullback is a chance to add more to your position.

And if you aren’t invested in cybersecurity stocks, you have a great buying opportunity.

The Russian conflict is moving cybersecurity stocks higher NOW.

A great place to put your money is the ETFMG Prime Cyber Security ETF (NYSE: HACK).

You can watch my new video about the HACK ETF by clicking on the video below.

But some cybersecurity stocks have more to gain than others.

One of them is in Ian King’s Strategic Fortunes portfolio.

This global cybersecurity leader offers an all-in-one platform for its customers.

For more info on Strategic Fortunes, you can check out Ian’s special presentation.

Regards,

a black and white drawing of a hand with a long pointy point

Steve Fernandez

Research Analyst, Strategic Fortunes

Morning Movers

From open till noon Eastern time.

Hemisphere Media Group Inc. (Nasdaq: HMTV) operates Spanish-language cable networks and streaming services. The stock jumped 79% on the news that the company is being acquired by private equity fund Gato Investments.

 

TreeHouse Foods Inc. (NYSE: THS) manufactures and distributes private-label foods and beverages internationally. The stock rose 17% after the company reported better-than-expected first-quarter results thanks to consumers switching to generic and private-label brands as inflations starts to take a toll.

 

Emerald Holding Inc. (NYSE: EEX) is a producer of trade shows, events, conference marketing and business-to-business software solutions. The stock is up 15% after reporting first-quarter results showing a robust recovery in the business and plans for future acquisitions.

 

Energizer Holdings Inc. (NYSE: ENR) manufactures, markets and distributes household batteries, specialty batteries and lighting products. It is up 11% after the company delivered strong results for the second quarter thanks to raising prices of batteries to combat the effects of inflation.

 

Zanite Acquisition Corp. (Nasdaq: ZNTE) is a special-purpose acquisition company that is up 10% the morning. The stock moved on the news that it has completed its business combination with Eve UAM, a developer of next-generation urban air mobility solutions.

 

White Mountains Insurance Group Ltd. (NYSE: WTM) provides insurance and other financial services in the U.S. It is up 8% on the news that it is selling its specialty insurance company, NSM Insurance Group, to Carlyle Group for $1.78 billion.

 

Tenon Medical Inc. (Nasdaq: TNON) is a medical device company that develops surgical implant systems for sacroiliac joint fixation and fusion surgery. It has no specific news to report; rather, it is up 6% on the continued excitement around the stock since its IPO two weeks ago.

 

Boise Cascade Co. (NYSE: BCC) manufactures wood products and distributes building materials in the U.S. and Canada. It is up 6% after reporting first-quarter results that beat both top- and bottom-line estimates due to steady demand across all its product lines.

 

Lancaster Colony Corp. (Nasdaq: LANC) manufactures and markets food products for the retail and food-service markets. The stock is up 6% today on a rebound after the stock dropped on Friday following a disappointing third-quarter report.

 

BioNTech SE (Nasdaq: BNTX) develops and commercializes immunotherapies for cancer and other infectious diseases. The stock is up 6% after the company reported better-than-expected results for the first quarter thanks to massive sales of its COVID-19 vaccine.

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