Demand for cybersecurity spending is growing, driven by regulatory requirements and rising ransomware attacks. Organizations are investing in this area to cope with the evolving cyber threats. As a result, top cybersecurity stocks have a revenue growth tailwind.
Over the next decade, several factors will fuel increased cyber spending. First, governments and regulators are enacting compliance requirements with regard to cybersecurity. For instance, the Securities and Exchange Commission recently adopted cybersecurity disclosure rules for registered companies.
Secondly, there have been severe cyberattacks on companies that have led to disruptions and financial losses. In September, MGM Resorts International (NYSE:MGM) suffered an attack that led to a $100 million negative impact on Adjusted Property EBITDAR. Another severe attack disrupted production at Clorox (NYSE:CLX), leading to a 23% to 28% sales decline.
Companies are taking note of the severe consequences of lacking a robust cybersecurity defense. Of course, top cybersecurity stocks have the technology to bolster networks and protect data. As cybersecurity demand grows, these stocks will thrive.
