These Stocks Could Benefit From the CDK Cyberattack
A cyberattack hit the software used by thousands of car dealerships in North America this week—which could spark renewed interest in cybersecurity stocks.
The Illinois-based software company CDK Global was hit with a cyberattack by an Eastern European hacking group that was seeking a multimillion-dollar ransom, Bloomberg reported.
A CDK representative didn’t return Barron’s request for comment. The firm says on its website that its software is used by nearly 15,000 car dealers. Sonic Automotive and Penske Automotive Group, both customers of CDK, have disclosed the incident in filings with the Securities and Exchange Commission.
Navellier & Associates co-founder Louis Navellier pointed out on Friday that the cyberattack seemed to energize cybersecurity stocks. An uptick in high-profile cyberattacks has been cited by analysts in the past as a potential catalyst to drive shares higher.
Cyberattacks have recently hit groups including
UnitedHealth
Group,
Clorox
,
rail company
Wabtec
,
Fresh Del Monte Produce
,
Caesars Entertainment
,
MGM Resorts
,
and the U.S. Marshals Service.
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Publicly traded firms offering cybersecurity solutions include
Palo Alto Networks
,
CrowdStrike
,
Zscaler
,
SentinelOne
,
Fortinet
,
and
Cloudflare
.
Palo Alto stock gained 3% on Friday, while CrowdStrike stock finished down 0.4%, recovering from earlier declines. Zscaler stock moved 0.5% higher while SentinelOne stock ticked up 2.1%. Fortinet stock finished up 1.1%, though Cloudflare stock ended 0.7% lower.
Write to Connor Smith at connor.smith@barrons.com
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