The Canadian cybersecurity stocks we’ve uncovered are expected to benefit from this long-term online protection trend
SmallCapPower | January 14, 2021: Forrester Research estimates that enterprises will spend US$12.6 billion on cloud security tools by 2023, up from $5.6 billion in 2018. As well, many companies have accelerated their digital transformation plans due to COVID-19, as many employees have been forced to work from home. Today we have discovered two Canadian cybersecurity stocks that could be worth holding for the long term.
*Returns are based on closing stock prices as of January 13, 2021
Absolute Software Corporation (TSX:ABST) – $17.37
Absolute Software is a cybersecurity company that specializes in endpoint security and data risk-management solutions. The company secures your data, all the devices that are part of your network, and all the applications/software your business uses, even when used remotely. During Q1 2021, the company’s revenue rose 11% year over year to $28.5 million, while its total annual recurring revenue increased 13% to $111.7 million. Absolute listed its shares on the Nasdaq in October 2020. ABT stock has a current dividend yield of 1.8%.
- Average annual return over the past three years: 59%
Evolve Cyber Security Index Fund (TSX:CYBR) – $47.75
While not technically a stock, this Canada-listed ETF invests primarily in shares of companies, located throughout the world, that are involved in the cybersecurity industry through hardware and software development. About 70% of CYBR’s holdings are U.S.-based companies. Evolve Cyber Security’s Top 5 holdings, comprising about 39% of the portfolio, are: Palo Alto Networks (NYSE:PANW) [8.6% of the fund], CrowdStrike Inc. (NASDAQ:CRWD) [7.9%], Okta, Inc. (NASDAQ:OKTA) [7.7%], Zscaler Inc. (NASDAQ:ZS) [7.6%], and Fortinet Inc. (NASDAQ:FTNT) [7.2%].
- Average annual return over the past three years: 41%
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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