Cybersecurity stocks like HUB Cyber Security (NASDAQ:HUBC) have long enjoyed a status as “necessities” in offices. Lately, that status has come under a bit of strain as budget officials reconsider just how vital the very latest firewall is. But it’s still a vital part of many operations. And HUB shot up over 13% in Monday afternoon’s trading thanks to a new move that may see it taking over a new cybersecurity firm.
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The latest word, and what sent HUB firing upward, was news of a new strategic alliance between itself and an unnamed cybersecurity company, one that focuses on the detection of, and the response to, various cyber threats. HUB will, as part of the alliance’s terms, have an option to buy up all the shares of said partner within the first six months of actually signing the agreement. Actually doing so would require about 20% of HUB’s shares, and if carried out, would raise HUB’s revenue by an as-yet-undetermined amount. Meanwhile, the duo will work toward marketing new combined solutions in the European Union, Israel, and the United States.
The news comes at a great time for HUB; reports note that, as recently as August, HUB was under a threat of potential bankruptcy. And that was after landing a valuation of $1.3 billion just six months prior when it started trading on the Nasdaq exchange after a merger with an SPAC. It certainly didn’t help matters that expenses went from $9.4 million in 2021 to $57.6 million just about a year later. The fact that it was also under investigation by the Israeli Securities Authority back in April definitely didn’t help either. But with a deal on tap that should improve HUB’s revenues, it should be a welcome development for investors.
Is HUBC a Good Investment?
Turning to Wall Street, analysts have little coverage on HUBC stock, so we must turn to the last five days of trading to draw conclusions. The good news there is that HUBC stock has generally been on the rise for that time period. While it spent much of that comparatively flat, the last two days have seen much more life in shares, climbing up over close to a third in just two days.
