Finance-related companies suffered the largest initial downturn following breaches, sinking more than 17% against the Nasdaq after 16 market days. The average share price for finance-related companies that were breached continued to underperform the Nasdaq by 2% six months out.
Technology stocks also take a significant initial hit, although not as much as financial names. The initial fall in performance of tech stocks was more gradual than in other categories, not bottoming out until 40 market days after the revelation of the breach. Before the breach, these companies outperformed the Nasdaq on average, but underperformed it in the six months after, according to the study.
“Breaches that leak more sensitive information and information from banks and financial institutions have a longer-term impact on stock prices than breaches of retail firms. People do not put as much trust in retail establishments,” Bischoff says. “We were not necessarily looking at causality, and other market forces may have affected some stock prices.”
Although the retail firms that were included were “some of the most high-profile data breaches, investors were unfazed,” the study says. “The firms suffered no immediate drop in share price performance, and six months after the breach the firms were only marginally worse off,” Comparitech says.
The interactive report is available at www.comparitech.com.