Sometimes a warning is anything but. The headline above is but one example that hackers use to trap unwitting computer users and gain access to their computers. There are school courses on hacking, hacking books and, yes, hacking software, which some speculate is created and sold by the same cyber criminals.
A survey of 600 computing and computer security executives in 14 countries noted that 40 percent expect a major cybersecurity incident in their sector within the next year. Eighty percent expect such an incident within five years, as noted in the New York Times (http://www.nytimes.com/2010/01/29/science/29cyber.ht). Do-it-yourself cybercrime kits are driving a surge in internet-based computer infections. Cyber crooks and veterans alike are using these DIY kits, according to USA Today (http://www.usatoday.com/money/industries/technology/2010-01-17-internet-scams-phishing_N.htm).
So which small-cap international software companies will benefit from this global growth in computer safety and security? Hard to say, but here are a few names that could be in the hunt.
Scotts Valley, CA-based VirnetX (NYSE Amex: VHC, http://www.virnetx.com) is focused on cyber security, has a $259 million market cap and an average daily trading volume of 265,000 shares a day. VHC develops software products designed to create a secure environment for real-time communications such as instant messaging. The company’s patent portfolio includes more than 48 U.S. and international patents and pending applications that pertain to LTE/4G security specifications.
Sunnyvale, CA-based Blue Coat Systems (Nasdaq: BCSI, http://www.bluecoat.com) has a market cap of $871 million and trades more than 780,000 shares a day. Its secure web gateway products provide virus scanning and, for IT administrators, visibility into and control of enterprise Web communications; Web anti-virus appliances for enterprises to scan for viruses, worms, spyware and a content filtering database to protect enterprise and service provider users and networks from Internet threats and inappropriate content and traffic.
Fremont, CA-based Network Equipment Technologies (NYSE Amex: NWK, http://www.net.com) trades more than 70,000 shares a day and has a market cap of about $105 million. Its customers include federal and international agencies and organizations including civilian and defense agencies. NWK offers government customers an IP-based secure voice solution with high bandwidth efficiency and call performance. NWK was one of two picks by TheStreet.com in its Stocks Under $5 column on July 1 based on good first quarter results and cash on its balance sheet.
Israel-based Allot Communications (Nasdaq: ALLT, http://www.allot.com) provides IP service optimization solutions for carriers, service providers and enterprises. It markets and sells its products principally to carriers, cable operators, wireless and wireline Internet service providers, educational institutions, governments and enterprises primarily in the U.S., Europe, Japan and other parts of Asia, Singapore, the Middle East and Africa. The stock hit a high of $5.87 in late April and early May but has dropped down to $4.25.
India-based Sify Technologies Ltd. (Nasdaq: SIFY, http://www.sifycorp.com) provides Internet, network and electronic commerce services in India. The company’s corporate network/data services comprise various Internet protocol-based virtual private network offerings including intranets, extranets and remote access applications; and security solutions such as security design, audit, procurement and integration. The company operates Internet data centers in Mumbai, Chennai and Bangalore. Since hitting a high of $2.85 last August, its stock price has decline steadily to about $1.20.