The Wall Street Transcript Publishes Internet Security Software Report In Business Services Industry Issue

Market Wire, 20050229

Five leading analysts and top management from twenty-five sector firms examine the Business Services Industry in a 146-page report in the latest issue of The Wall Street Transcript (212/952-7433) or www.twst.com/info/info177.htm

In a vital review of this sector for investors and industry professionals, this valuable 146-page Special Issue features:

1) Internet Security Software - In an in-depth (3,500 words) Analyst Interview, Chuck Jones, Analyst at Salomon Smith Barney, examines the outlook for the sector, including virtual private networks, public key infrastructure, company risk factors, and shares specific stock recommendations.

Jones reports on Check Point Software (Nasdaq: CHKP) and VeriSign (Nasdaq: VRSN), "Check Point and VeriSign, which are very much at the high end of the valuation of the overall market. So when you're looking at extremely high growth rates for the leaders in their industry, then those are two very worthwhile companies that can really provide a lot of the main Internet infrastructure, and can become, in Check Point's case, the de facto standard in the firewall software marketplace, and in VeriSign's case, the leader in outsourcing public key infrastructure applications and domain names recognition. Both companies also generate a tremendous amount of deferred revenue. We have built a model that determines how much revenue comes from deferred revenue; for Check Point in the September quarter we estimate it to be 33% and for VeriSign we project it to be 59%. This provides a tremendous amount of visibility into our revenue projections."

Jones discusses Symantec (Nasdaq: SYMC), "There have been major concerns with them recently because half of their revenue comes from their consumer business and because of integration issues with the acquisition of AXENT. But when you use our calendar 2001 earnings of approximately $3, and with the stock trading at around $48, the shares are at 16 times next year's earnings with top-line growth in the 20%-23% range, and bottom-line EPS growth higher than that. I believe that there is limited downside, and I give John Thompson, Symantec's CEO, a good chance of pulling off the integration of AXENT, given his strong background at IBM. The key linchpin for the merger will be the sales force integration. I believe that it's a very good value technology stock."

Jones highlights RSA Security (Nasdaq: RSAS), "The great thing about RSA is it's really in three distinct businesses, and while they aren't weighted the same, they provide a diversified base to weather weaknesses. The original Secure Dynamics business provides a hardware and software solution for users to log in remotely and authenticate themselves. The original RSA encryption business is going quite well and the company has been selling a PKI solution for about a year. One of the major concerns with RSA is that its original algorithm patent expires on September 20. My thoughts are when you take a look at the software developer kit to develop an encrypted application, that the algorithm is just one of 30 components and features in the kit. Therefore there is a lot more secret sauce besides the algorithm to have a secure application."

2) Business Services Industry - In an in-depth (16,100 words) Analyst Roundtable, Kevin Dyches, First Vice President at Prudential Securities, Kelly Flynn, Vice President for Business Services at PaineWebber, Christopher Gutek, Research Analyst at Morgan Stanley Dean Witter, and Brandt Sakakeeny, Member of Deutsche Banc Alex. Brown, discuss the outlook for the sector, including human capital space, online recruiting sector, outsourcing trends, and share specific stock recommendations.

3) The TWST confidential Off-The-Record survey of management performance at twenty-four sector firms asked market insiders about the ability of management teams to create shareholder value. Firms reviewed in Off-The-Record include: Administaff, CCC Information Services, Cintas, Concord EFS, Cornell Companies, CSG Systems International, Dendrite International, G&K Services, Intuit, Jack Henry & Associates, Labor Ready, Manpower, NCO Group, Pegasus Solutions, Plexus, Prison Realty Trust, Profit Recovery Group, Res-Care, Robert Half Int'l, ServiceMaster Company, Spherion, Staff Leasing, UniFirst, Wackenhut Correction

4) CEO interviews (average 2,500 words). Top management of twenty-five sector firms examine the outlook for their firm and the sector. Firms include: CTC Communications Group, Digital Recorders, First Priority Group, HyperFeed Technologies, Insignia Financial Group, Preview Systems, Universe2U, ASI Solutions, Electronic Clearing House, Exult, Judge.com, Leapnet, Manchester Equipment Company, Marketing Services Group, McAfee.com, National Processing Company, Niku, Organic, PentaStar Communications, PFSweb, Promotions.com, Provant, Take to Auction.com, ValueClick, VSI Holdings

To obtain a copy of this 146-page Business Services Industry issue, call (212) 952-7433 or see www.twst.com/info/info177.htm