3 Cybersecurity Stocks To Watch With Earnings Growth Up To 45% - Simply Wall St
Inflation concerns are driving investors toward cybersecurity stocks as digital activity increases, with Okta, Datadog, and CrowdStrike showing strong earnings potential.
Inflation has returned to the forefront after October's consumer price report showed a 0.4% monthly increase, keeping security risks at the forefront as more activity shifts online. When prices and rates dominate headlines, capital often flows toward business models tied to essential digital infrastructure, including cyber defense.
Three cybersecurity stocks from Simply Wall St's global screener are attracting significant investor attention. These companies represent different approaches to securing digital assets but share strong earnings growth potential of up to 45%, making them particularly attractive in the current economic climate.
Identity Management Leader
Okta operates an identity and access management platform that secures logins, governs permissions, and protects user and machine identities across cloud and on-premises systems. The company generates $3.1 billion in revenue through multi-year subscriptions to its cloud-based offerings and has a market capitalization of $31.9 billion.
Okta draws attention because identity is often the first target attackers attempt to breach. Tokyo, an investor in the Simply Wall St Community, notes that how Okta monetizes this critical gatekeeper role will determine its future trajectory.
But a non-profitable company acquires a non-profitable company, makes an existing problem even bigger.
Cloud Observability Platform
Datadog operates a cloud-based observability and security platform that helps organizations monitor systems and detect cyber threats across modern applications. The company generates approximately $4.3 billion from IT infrastructure monitoring and security products, with $3.0 billion coming from the United States and $1.2 billion internationally.
With a market cap of $66.6 billion, Datadog matters because its AI-fueled observability data feeds directly into a growing cloud security toolkit. The company has over 750 AI customers, including all 10 of the top AI leaders, and its AI Guard and Bits AI features are expanding use cases like GPU monitoring.
Comprehensive Security Suite
CrowdStrike Holdings operates the Falcon cloud platform, a subscription-based suite that protects endpoints, cloud workloads, identities, data, and AI systems from cyber attacks. The company generates about $5.4 billion from security software and services, with most revenue from the United States and the rest across EMEA, Asia Pacific, and other regions.
With a market capitalization of $235.9 billion, CrowdStrike's significance lies in its single subscription platform designed to secure multiple aspects of digital infrastructure. The introduction of Falcon Flex, a subscription model that accelerates module adoption and simplifies procurement, is increasing customer commitment and lengthening customer relationships.
The company's future growth may depend on how AI-driven security categories reshape bundled contracts, potentially creating deeper customer lock-in as businesses increasingly rely on comprehensive protection for their expanding digital footprints.
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