Much was made about the recent announcement that Starbucks was joining forces with Square, a San Francisco-based technology start-up that created the Pay With Square app that allows consumers to pay merchants with a mobile phone. The New York Times asked readers if that means “your phone will soon replace your wallet?” The story didn’t actually answer the question, but the headline suggested that “the campaign to digitize your wallet is intensifying” (http://www.nytimes.com/2012/08/10/technology/the-campaign-to-digitize-your-wallet-is-intensifying.html?_r=1).
If so, the biggest challenge for a company like Square (or a retailer like Starbucks) may be “convincing people that paying with a phone is safer and more convenient than using cash or a credit card,” according to the Times. It’s the “safer” part that piqued our interest. There’s little doubt that security is a big question when it comes to using a phone to pay bills.
This prompted us to look for companies that provide businesses and consumers security for their information. One of the big guys would be Mountain View, CA-based Symantec Corp. (Nasdaq: SYMC), but at nearly $13 billion in market cap it’s no fit for our small cap blog.
Smaller cap stocks generally in this field include (all chosen randomly):
San Diego-based Websense (Nasdaq: WBSN, http://www.websense.com/) provides web, email and data security solutions to protect an organization’s data and users from cyber threats, malware attacks and information leaks, among other threats. TheStreet Ratings downgraded WBSN from buy to hold on Aug. 16, noting that while the company has seen growth in earnings per share and an increase in net income, the stock itself has shown weakness. WBSN’s market cap is $547 million and its 52-week trading range is $14.26-$22.15. It closed Aug. 22 at $15.05, down 3 cents on the day.
Pasadena, CA-based Guidance Software (Nasdaq: GUID, http://www.guidancesoftware.com/) provides digital investigative solutions to government organizations and corporations. The company’s EnCase Cybersecurity forensic solution exposes, triages and remediates threats. Its market cap is $259 million and 52-week trading range is $5.54-$11.87. GUID closed Aug. 22 at $10.41, up 4 cents on the day.
Israel-based Commontouch Software (Nasdaq: CTCH, http://www.commtouch.com/) provides messaging, anti-virus and Web security solutions to OEM customers, enterprises and service providers. CTCH offers its solutions to network and security vendors offering content security gateways, unified threat management solutions, and antivirus solutions, for example. CTCH has a market cap of $70 million and a 52-week trading range of $2.41-$3.64. It closed Aug. 22 at $2.85, down 9 cents for the day.
Lee, MA-based Wave Systems Corp. (Nasdaq: WAVX, http://www.wavesys.com) produces and markets products for hardware-based digital security. In particular, these include security applications and services that are complementary to and work with the specifications of the Trusted Computing Group, an industry standards organization. Its market cap is $99 million and its 52-week trading range is $0.53-$2.92. It closed Aug. $1.03, up 2 cents for the day.