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Business News Sat, 19 Dec 2020

Cyber technology shares soar as security attacks pile up

Shares in cyber security companies climbed rapidly on Friday as investors bet that a spate of cyber attack disclosures from entities such as Microsoft Corp would boost demand for security technology.

Shares in FireEye Inc, Palo Alto Networks and Crowdstrike Holdings all raced ahead after Microsoft said on Thursday that it found malicious software in its systems related to a massive hacking campaign disclosed by U.S. officials this week, adding the software giant to a growing list of attacked government agencies.

Microsoft is a user of Orion, the widely deployed networking management software from SolarWinds Corp which was used in the suspected Russian attacks on vital U.S. agencies and others.

“This news increases the awareness in regards to the federal government’s susceptibility to cyber attacks from Russia and other foreign entities,” said Daniel Morgan, portfolio manager at Synovus Trust in Atlanta.

Morgan added that technology security companies are “all perceived to benefit from an increase in spending and awareness” he expects will happen as the U.S. government looks to prevent future hacks.

FireEye’s shares were last up 25.1% at $17.99, their highest point since January, and on track for their biggest one-day percentage gain since January 2014.

The stock had tumbled below $14 on Dec. 9 after FireEye became the first organization to disclose an attack related to the recent hacking campaign.

Friday’s focus on cyber stocks also sent shares of Crowdstrike up 9.7% and shares of Palo Alto up 7.1%. Shares of Zscaler, another security firm, rose 4.8%.

Wedbush analyst Daniel Ives wrote in a research note that the recent attacks could rank among the worst ever and highlight a large market for cyber security products.
Source: reuters.com
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