Cybersecurity stocks are trading up after a high-profile global ransomware attack proliferated over the weekend.
The attack that started on Friday targets a Microsoft vulnerability that has already been fixed. As a result, the ransomware only affects systems that have not updated their software.
Ransomware locks up computers/IT systems until a ‘ransom' is paid to the hackers. Large enterprises like Telefonica, Nissan and FedEx were infected.
Interestingly, the Microsoft vulnerability was reportedly used by the National Security Agency. Hackers called the Shadow Brokers leaked information regarding this last Summer. This attack has created fears that more will follow.
President Donald Trump signed a delayed executive order calling for increased cybersecurity protection last week.
Security stocks, best represented by the Cyber Security ETF (HACK), have broken out to a 22-month high:
- SCWX +9.6%, PFPT +9.1%, MIME +8.1%, FEYE +8.0%, QLYS +5.5%, ZIXI +5.3%, SYMC +4.2%, CUDA +4.1%, FTNT +4.0%, RPD +3.9%, PANW +3.6%, CHKP +2.2%, IMPV +2.0%
Email security firms Proofpoint (PFPT) and Mimecast (MIME) are leading the way higher. Business email compromise (BEC) scams are on the rise as hackers target people instead of infrastructure. All it takes is one person to click on link from a spam email to infect a network.
FireEye (FEYE) has struggled in recent years but is a leader in servicing firms that have been hacked.
David Tepper's Appaloosa disclosed a new stake in Symantec (SYMC) late on Friday. Last week, the stock fell after reporting in-line Q4 results. Proofpoint recently called out Symantec specifically as an incumbent losing market share in email security. Symantec acquired LifeLock for $2.3 billion earlier this year.