Despite difficult market conditions, I think this information technology share is a top growth stock to consider in October. Here’s why.
A huge opportunity
It seems that not a day goes by when news of another major cyberattack hits the headlines. This week, Japanese beer giant Asahi announced a hit that downed production across its factories, causing a widespread product shortage in the country.
Other significant attacks in 2025 alone have sabotaged operations and stolen data at Jaguar Land Rover, Marks & Spencer, UnitedHealth and Astral Foods. As this list shows, hackers aren’t limiting their attacks to certain sectors or regions, meaning companies across the world need to be vigilant against such threats.
This leaves an enormous opportunity for software companies like Softcat (LSE:SCT). Some analysts believe the global cybersecurity market could expand at an compound annual rate of 10% from now to 2033.
Softcat provides a wide range of IT applications for businesses. This includes cloud services, networking, connectivity and software licensing. But it’s in the field of cyber protection where its clients are showing the greatest interest.
The FTSE 250 company has said that “our annual customer experience survey highlighted cyber security as the most common customer priority, reflecting the relentless development of new cyber threats and the need to protect proliferating and increasingly sensitive data and operating systems.”
Reflecting this, Softcat said strong demand in this segment drove gross profit growth of 12.1% in the first half of its financial year (August-January).
Impressive growth
What I like about Softcat is its diversified approach across different IT segments. Not only does this provide a multitude of ways to capitalise on the booming digital economy and growth segments like cybersecurity. It also leaves it better placed to defend and grow profits if particular areas come under pressure.
This broad wingspan has delivered robust and consistent annual bottom-line growth during the last five years. In financial 2020, it recorded earnings per share (EPS) of 38.2p per share. Last year this had leapt to 59.7p per share.
City analysts are expecting Softcat’s proud record of earnings improvement to continue, too.
| Financial Year To July… | EPS | Annual growth |
|---|---|---|
| 2025 | 68.1p | 14% |
| 2026 | 71.5p | 5% |
| 2027 | 78.2p | 9% |
A top tech stock
Of course there are dangers to these forecasts. Tough economic conditions in its markets could impact sales if companies cut back on spending. This may not impact essential areas like cybersecurity, but demand for its other services could disappoint.
On top of this, Softcat faces not-insignificant competition across its markets. This includes from heavyweight US technology companies that have deeper pockets and stronger brand power.
But this UK growth stock has proved it has what it takes to thrive despite these risks, as those strong half-year results I mentioned show. Softcat shares have delivered an average annual return of 22% over the last decade. I’m expecting it to remain a top stock for long-term investors to consider.
