What Happened?
A number of stocks jumped in the morning session after U.S. and international security agencies issued a joint warning about Russian state-sponsored cyber threats targeting critical infrastructure.
The Cybersecurity and Infrastructure Security Agency (CISA), in collaboration with the National Security Agency (NSA) and the FBI, released an advisory warning that Russian cyber actors are exploiting vulnerable networking devices and routers.
The advisory highlighted that sectors such as communications, energy, government, and healthcare were being targeted globally. Such high-level alerts about cyber threats often increase investor interest in cybersecurity companies, as they underscore the growing need for advanced security solutions to protect essential services and infrastructure.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Identity Management company Okta (NASDAQ: OKTA) jumped 10.2%. Is now the time to buy Okta? Access our full analysis report here, it’s free.
- Network Security company Palo Alto Networks (NASDAQ: PANW) jumped 6%. Is now the time to buy Palo Alto Networks? Access our full analysis report here, it’s free.
Zooming In On Okta (OKTA)
Okta’s shares are very volatile and have had 21 moves greater than 5% over the last year. But moves this big are rare even for Okta and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 8 days ago when the stock gained 3.4% on the news that Scotiabank upgraded the stock to Outperform from Sector Perform and set a $165 price target.
The firm views the identity and access management company as a beneficiary of artificial intelligence trends. The bank believes that as businesses prepare for AI, they will increase cybersecurity spending and look to modernize their identity management systems, which should benefit Okta.
Okta is up 83.9% since the beginning of the year, and at $153.80 per share, it has set a new 52-week high. Despite the year-to-date gain, investors who bought $1,000 worth of Okta’s shares 5 years ago would now be looking at only $635.25.
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