Darktrace shares price to rally again following sell-off?

Darktrace Share Price

Darktrace (LON:DARK), the British-American cybersecurity company, has dipped for the fourth consecutive week, down 16.33% over the past month. The move downwards comes on the back of what has been a a successful run since the company’s IPO in April. Following Darktrace’s London listing, its share price surged by 90p within hours. On the 30 July it reached as high as 765p before coming back down to its level at the time of writing of 579p. While Darktrace’s opening months on the stock market demonstrated investors’ confidence in the cybersecurity firm, the recent dip could serve as an ideal moment to buy. One factor that is creating optimism around the Darktrace share price is the continued growth of the cybersecurity industry.

Why did the share price fall?

A small group of investors in Darkface offloaded shares worth close to £150m earlier this month, taking profits from its bull-run following its flotation.

KKR, the American private equity giant, Hoxton Ventures and Balderton Capital found buyers for 23.15m shares, which caused the Darktrace share price to dive. According to The Times, 1.8m shares in the cybersecurity firm are traded in each session.

Cybersecurity

Cybersecurity is becoming more important within the global economy, albeit for some concerning reasons. The ability to keep information secure is increasingly important and there is plenty of money to be made if a company is able to do so.

Just under 40% of businesses in the UK have been the victim of a cyber attack over the past year, with 21% of that figure having reported losing data, money or assets.

In 2020, losses due to cybercrime came to $1trn, per McAfee, the anti-virus manufacturer, while the cybersecurity market could be worth as much as $400bn by 2027.

The demand for Darktrace’s services are there, and if the company can become a world leader, then its shareholders could become very wealthy.