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This Cybersecurity Stock Gained Over 35% This Year

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Cybersecurity stocks are lit this year.

Just as a point of reference, one cybersecurity ETF alone [HACK] is up over 26% in 2018.

You remember the ETFs, right? It’s the investment funds that pick up a type of stock (like tech or REITs), diversify their holdings across that sector, with the idea of giving you nice, solid, stable returns.

Anyway, why are cybersecurities hot?

Pretty simple. As Facebook told the White House a month ago, we’re in a “cybersecurity crisis.”

So basically, as cyber threats continue to increase, so does enterprises spending on cybersecurity.

According to McKinsey, almost 80% of companies plan to move 10% or more of their business to the cloud.

So obviously, this mass migration towards the cloud forces increased network security services.

But one in cybersecurity stock, in particular, is straight fire. One of the top cybersecurity companies, Proofpoint [PFPT] has exploded from $4.16B in early January to $6.08B to date.

And the way things are trending, this stock could go even higher. Let’s break it down.

Cybersecurity is growing as a whole

The worldwide security appliance revenue rose 14.3% year-over-year to $3.24B in the first quarter of 2018.

Moreover, the global cybersecurity market is expected to experience serious growth; revenues are expected to explode from $153B in 2018 to $232B in 2022.

Here’s CNBC’s stock expert Jim Cramer breaking down his favorite cybersecurity stocks.

Growth spurt: From $905M to $6B

Proofpoint provides cloud-based security solutions and services, ranging from email protection, ATP (advanced threat protection), data loss prevention, email authentication, secure communication just to name a few.

Shares of Proofpoint have increased over 8x from $14.08 in April 2012 to $119.8 in August 2018, powered by growth in revenue and earnings.

In raw market value, that’s a jump from under $1B in value to more than $6B, as mentioned before. (Sick.)

Revenue’s up 5X

Proofpoint’s revenue has grown from $106M in fiscal year 2012 to $515M as of ’17.

And get this: Analysts expect revenue to continue to climb to $708M in 2018, $906M in 2019 and $1.15B in 2020.

(The cybersecurity crisis must be real!)

Proofpoint’s revenue-driving strategy has historically been focused on new products, acquisitions and partnerships.

(Proofpoint acquired Wombat Security in February 2018. Which followed a 2017 acquisition of Cloudmark, a company specializing in security for messaging services. And Weblife.io, a leader in browser isolation solutions. And…you get the point.)

This strategy—coupled with a high customer renewal rate of over 90%—indicates robust product portfolio and a high customer satisfaction rate.

Still not profitable (but who cares?)

Similar to several other tech companies, Proofpoint is still reporting losses.

That said, Proofpoint’s net margin is expected to improve from -16.8% in 2018 to -10.3% in 2020. As the company continues to gain market share, investors likely won’t care too much either.

The Cali-based company continues to allocate significant resources towards sales and marketing—something analysts expect will impact profit margins in the short-term.

The threats…

There is also a threat of competition from heavyweights like Cisco [CSCO] and other niche players including Palo Alto Networks [PANW], Symantec [SYMC], Fortinet [FTNT] and FireEye [FEYE].

Proofpoint’s shares fell from $127.7 to $112.7 in July after quarterly results were released. Analysts were not too buoyed by the firm’s revenue forecast, which resulted in a sell-off (and thus a drop in the price).

Still all good, though!

All in all, Proofpoint shares have risen 35% in 2018.

The stock seems to have recovered from the Q2 hiccup, too. It rose over 4% on Aug. 24.

That said, the stock is still trading at a discount to its low analyst price target of $125. What does that mean in layman’s terms?

Over 90% of analysts recommend a “buy” on the stock with an average price target of $139.67—plenty of juice left to make a score for the year.

Have at it, WealthLABBERs…

*Opens Robinhood…*

Money

CHART: How Blockchain Powers Bitcoin

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Blockchain, Bitcoin. Bitcoin, blockchain.

The two terms go hand in hand—and have become almost ubiquitous with this year’s insane rise (and fall) of Bitcoin.

But what does it all really mean? How does it come together? In this week’s chart, our friends at CB Insights break down exactly how blockchain powers Bitcoin.

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Business

This Mogul Became America’s 1st Black Billion-Dollar Businesswoman

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Sheila Johnson.

Where to start?

She’s the first black billion-dollar businesswoman. Before Oprah Winfrey.

She started as a TV executive, founding Black Entertainment Television (BET), the first TV network targeting African Americans. She then became a real estate mogul.

Oh, she also owns a stake in three major sports franchises, the NBA Wizards, NHL Capitals and the WNBA Mystics, the African American, period, to boast that claim.

In honor of Black History Month, let’s dive into her remarkable career.

FAST FACTS:

  • Born Sheila Crump in McKeesport, Pennsylvania, Johnson co-founded BET in 1979 with then-husband Robert Johnson. The couple sold it to Viacom in 2000 for $2.9B
  • Sheila Crump Johnson became the first African American woman on the Forbes’ Billionaire list in 2000—beating Oprah Winfrey to the distinction.
  • Per Forbes, Johnson has an $820M net worth as of 2019

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Foray into real estate…

After closing the sale to Viacom, Robert and Sheila pocketed around $1.5B each. Johnson used that windfall as seed money to build a hospitality real estate empire in 2005.

“There’s a disparity in paychecks between whites and blacks,” she told the Wall Street Journal. “I will never forget that.”

As CEO of Salamander Hotels and Resorts, Sheila controls a spectacular portfolio of six luxury hotels in Florida, Virginia and South Carolina. And she’s built it from the ground up—literally—in her own spirit.

“I’ve been to many hotels, not only in the US, but all over the world,” she told Forbes last year. “And I wanted to find something that was going to really make Salamander stand out beyond all of these hotels.”

So what does that mean?

“You have to understand, there are a lot of people, investment companies, with very deep pockets,” she says. “They can do it, but they don’t have the experiences that we’re able to bring. I am constantly trying to find a way to help Salamander Resort & Spa stand out head over heels above any other hotel — not only in the area, but in the nation.

“I want them to leave that resort wanting to come back and not just say, ‘I’ll be back in six months.’ I want them to come back all the time.”

And so far it’s worked. In fact, on Forbes Travel Guide’s 61st list of Star-Rated hotels, Johnson’s Salamander Resort & Spa outside of Washington, DC earned a Five-Star distinction.

Image Credit: Salamander Resort & Spa

Forbes: “Everything [she] touches turns to gold.”

That’s a real quote. From Forbes. Last year. It’s also true.

BET? Billion-dollar exit. Washington Capitals? Stanley Cup.

And Roma. Won 10 Oscars. Who showed it before a single soul started caring? Johnson’s Middleburg Film Festival. (Which, by the way, has 32 films and counting in Academy Award contention.)

Remember her golf resort at Innisbrook? Oh, yeah. Hosts the Valspar Championship, one of the PGA calendar’s most-anticipated tournaments.

Becoming a billionaire comes with a new level of clout as well. “When you don’t have money, you’re not invited to special events; you really don’t matter,” she told WSJ. “It’s a society thing.”

So instead, she’s turned to giving back. Her Sheila Johnson Fellowship’s paid for more then 40 scholarships at Harvard University for students who otherwise wouldn’t afford to attend.

Image result for sheila johnson"

Breaking glass ceilings. 

There’s an alarming statistic in business and diversity—especially as it pertains to women. According to research by investor Richard Kerby, 18% of all VCs are women—and only 3% are black. In addition, less than 50 black women ever have raised $1M in funding.

“When I got started,” Johnson says, “I couldn’t get a loan. I had to use my own money to get Salamander Resort and Spa.”

She explained to WSJ last year that men can go to any bank with a bank proposal. And no matter how “wacky” the idea is, she said, “they’re going to get the financing. Women do not have that ability.”

Johnson’s taken it upon herself to do something about that, becoming one of the founding partners of WE Capital, an investment firm that invests in female entrepreneurs.

“I started out in a very unique position where I had my own capital to be able to get started,” she says. “But there have got to be banks and investors that believe in helping women who want to be entrepreneurs in the hospitality business.

“And it’s just really, really important that they really take a look at this.”

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Money

VIDEO: How Far Does $150K A Year Get You In New York City?

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Source: HuffPost

No matter what metric or list you look at, it goes without saying: New York City is one of the most expensive places in the world to live in.

In this video, CNBC spoke to a Millennial who runs her own brand consulting agency and wants to #WealthHACK her way to retirement by 40.

She makes $150K a year. But how far does that actually get her? Check it out.

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