Connect with us

Hi, what are you looking for?

SecurityWeekSecurityWeek

Endpoint Security

UK Cyber Firm Faces Investors Over Stock Turmoil

British cyber security firm Darktrace came under investor scrutiny Wednesday over dramatic share price gyrations since its headline-grabbing London stock market float.

Darktrace, based in the English university city of Cambridge, held its annual general meeting amid growing unease over the stock.

British cyber security firm Darktrace came under investor scrutiny Wednesday over dramatic share price gyrations since its headline-grabbing London stock market float.

Darktrace, based in the English university city of Cambridge, held its annual general meeting amid growing unease over the stock.

The company, which uses cutting-edge artificial intelligence (AI) technology to combat cyber attacks, arrived on the London stock market in April.

The initial public offering launched at 250 pence per share, valuing Darktrace at £1.7 billion ($2.3 billion, 2.0 billion euros).

Shares then vaulted higher in subsequent weeks and months to hit a peak of almost 1,000 pence in September.

Darktrace also joined London’s prestigious FTSE 100 index of top companies last month.

But shares then tanked after brokerage Peel Hunt questioned its valuation and technology.

In Wednesday afternoon trade, shares sank 3.25 percent to 482.60 pence, valuing Darktrace at £3.4 billion.

Advertisement. Scroll to continue reading.

However, that was still around double the company’s launch price and initial value.

Darktrace nevertheless now faces potential relegation from the London Stock Exchange’s FTSE 100 club.

One shareholder at Wednesday’s AGM complained that a Darktrace director had sold a large amount of stock just as the share price was sliding, sending a “mixed message” to markets.

Another investor argued Darktrace had invested insufficient cash into research and development, in contrast with US rivals.

Yet the company countered Wednesday that it had delivered “strong” earnings in a critical year.

“Having delivered a strong set of full-year results and successfully completed our IPO, 2021 has been a pivotal point in Darktrace’s journey so far,” said Chairman Gordon Hurst.

Annual revenues had surged 41 percent $281 million, he added, with a similar uptick forecast next year.

Darktrace was founded eight years ago and has since rapidly expanded to serve more than 5,900 customers in around 100 countries, with a global workforce of 1,600.

CMC Markets analyst Michael Hewson argued it remained a “decent” business with a solid outlook.

“Its IPO price was 250 pence — and it’s still well above that,” Hewson told AFP.

“The falls from the 1,000 pence high look stark — but are symptomatic of a concerns about an elevated valuation after a recent broker note.

“Even with the recent declines and possible demotion from the FTSE 100, it’s still a decent business with good prospects.”

Written By

AFP 2023

Click to comment

Trending

Daily Briefing Newsletter

Subscribe to the SecurityWeek Email Briefing to stay informed on the latest threats, trends, and technology, along with insightful columns from industry experts.

Join the session as we discuss the challenges and best practices for cybersecurity leaders managing cloud identities.

Register

SecurityWeek’s Ransomware Resilience and Recovery Summit helps businesses to plan, prepare, and recover from a ransomware incident.

Register

Expert Insights

Related Content

Endpoint Security

Today, on January 10, 2023, Windows 7 Extended Security Updates (ESU) and Windows 8.1 have reached their end of support dates.

Application Security

Virtualization technology giant VMware on Tuesday shipped urgent updates to fix a trio of security problems in multiple software products, including a virtual machine...

Endpoint Security

Gigabyte has announced BIOS updates that remove a recently identified backdoor feature in hundreds of its motherboards.

Endpoint Security

Several major companies have published advisories in response to the Downfall vulnerability affecting Intel CPUs.

Application Security

Microsoft on Tuesday pushed a major Windows update to address a security feature bypass already exploited in global ransomware attacks.The operating system update, released...

CISO Strategy

Varied viewpoints as related security concepts take on similar traits create substantial confusion among security teams trying to evaluate and purchase security technologies.

Endpoint Security

The Zero Day Dilemma

Endpoint Security

When establishing visibility and security controls across endpoints, security professionals need to understand that each endpoint bears some or all responsibility for its own...