Data breaches negatively affect a company’s ability to do business, public perception of the company and, new research shows, its stock prices. According to a recent study by Comparitech, such cyberattacks can drive a stock’s performance down on the day of the announcement, and they can slow future growth of a stock for years. Also the sensitivity of the data leaked—credit card numbers versus email addresses, for instance—directly affects Wall Street’s reaction.
For the study, Comparitech, a consumer tech product review and comparison site, examined 24 companies listed on the New York Stock Exchange and other public markets, studying each company’s share prices before and after a data breach was publicly announced. The team used the Nasdaq’s overall performance as a baseline to compare results. For instance, if the Nasdaq performed poorly overall on a certain day, it could frame a single company’s stock drop in a wider context.
