Cybersecurity Stock Sell-off Holding Back Nasdaq, but 1 Tech Stock Is Surging
The Nasdaq Composite Index (NASDAQINDEX: ^IXIC) is roughly flat today, Aug. 4, at 2:15 p.m. ET. It's a bit of a bounce-back day for a number of tech stocks that have stumbled in recent days post-earnings. However, the most popular cybersecurity stocks are decidedly not having a good day, following the release of second-quarter earnings from Fortinet (NASDAQ: FTNT) Wednesday afternoon. At the time of this writing, Fortinet shares are down almost 17%, while Palo Alto Networks (NASDAQ: PANW), CrowdStrike (NASDAQ: CRWD), and Zscaler (NASDAQ: ZS) shares are down between 5.4% and 3.3% on the day.
One of today's best-performing Nasdaq stocks is Latin American payments and e-commerce leader MercadoLibre (NASDAQ: MELI). Shares are up 16% after the company reported second quarter results that investors loved.
Cybersecurity stocks, as a cohort, have held up better this year than many other high-growth tech stock sectors. So far this year, shares of Palo Alto Networks and CrowdStrike are down about 22%, while Fortinet shares are down 27%. Before today, the three were down in the teens this year, not a good result, but certainly less bad than plenty of tech stocks in 2022. One key reason is the increasing importance of cybersecurity for organizations of all kinds. As digital transformation ramps up, data security is an imperative, not a luxury, and investors have increasingly viewed the prospects for these companies as being more stable and less likely to be upended by the economic climate.
Source Fool.com
