Can Corero Network Security keep up momentum?

Thursday, Mar 29 2012 by
4
Can Corero Network Security keep up momentum

Selling software to the financial services sector was a pretty brutal market for any business to be in during the dark years of the economic slump – as investors in AIM quoted Corero Network Security (LON:CNS) could testify. Long term holders in the business haven’t had much to cheer about over the last three years but the influence of a new management team (and a new strategy) appears to be breathing new life into the shares.

Chairman Jens Montanana and operations chief Andrew Miller took Corero by the scruff of the neck in July 2010; first selling the flagging Financial Markets division and then raising £6.5 million for new projects. The remaining Business Systems arm continues to turn a profit by selling finance and admin software to education institutions, notably Academies, which have been unhooking themselves in increasing numbers from the central command of Local Education Authorities.

Perhaps of more interest, Montanana – who co-founded AIM and Jo’burg listed Datatec (LON:DTC) – set out to forge a future for Corero in network security, in other words helping mid-market business customers protect themselves from hackers and viruses. A year after his arrival, the company snapped us US-based Top Layer Security to give it the initial platform that was needed and renamed it Corero Network Security. So far, so good but the shares didn’t budge from sub-50p until earlier this month when the company raised another £4.5 million to develop the new division and produced a set of results that appears to have inspired more confidence.

While it remains loss making, Corero’s revenues jumped to £11.3 million from £3.0 million with interim sales growth of 308% amidst surging customer numbers: up 78 on the Network Security side plus another 192 Academies for Business Systems.

Unsurprisingly, the fundamentals deliver a mixed picture on Corero’s Stockopedia Stock Report . The long history of losses quite rightly raise a few red flags, although , Montanana and Miller’s new strategy may take some time to filter through to the numbers. But optimists might say that the market is a forward looking mechanism and cite the strong share price momentum as a signal of things to come. Corero’s recent run propelled the stock to within touching distance of our 52 Week High Momentum Screen this week –…

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Disclaimer:  

As per our Terms of Use, Stockopedia is a financial news & data site, discussion forum and content aggregator. Our site should be used for educational & informational purposes only. We do not provide investment advice, recommendations or views as to whether an investment or strategy is suited to the investment needs of a specific individual. You should make your own decisions and seek independent professional advice before doing so. Remember: Shares can go down as well as up. Past performance is not a guide to future performance & investors may not get back the amount invested. ?>


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Datatec Limited is a South Africa-based company engaged in information and communications technology (ICT) business. The Company operates through three segments: Westcon International, Logicalis and Corporate Consulting and Financial services. Westcon International is a technology distributor. Logicalis is a provider of information and communications technology (ICT) solutions and managed services. The Consulting segment is engaged in the strategic and technical consulting and research. The Corporate segment includes head office companies, including Datatec Financial Services. The Company operates in more than 60 countries across North America, Latin America, Europe, Africa, the Middle East and Asia-Pacific. Its subsidiaries include Analysys Mason Limited (Mauritius), and Netshield (Pty) Ltd. more »

LSE Price
310p
Change
 
Mkt Cap (£m)
22.3
P/E (fwd)
n/a
Yield (fwd)
n/a

Corero Network Security plc is a provider of Distributed Denial of Service (DDoS) defense solutions. The Company's DDoS protection solutions provide automatic detection and mitigation of DDoS attacks for Internet service providers, hosting providers and the online enterprise. It operates through Corero Network Security segment. Its product offering includes SmartWall Threat Defense System (TDS), which is a network security appliances configurable to meet the needs of service and hosting providers and online enterprises, all of which are impacted by the challenges of DDoS attacks. The SmartWall TDS appliances include SmartWall Network NTD Appliance and SmartWall Network Bypass Appliance. It provides SecureWatch PLUS, which offers a suite of DDoS defense configuration, optimization, around the clock monitoring and attack mitigation services. Its technology provides a First Line of Defense against DDoS attacks. It has presence in North America, the United Kingdom and Other countries. more »

LSE Price
8p
Change
 
Mkt Cap (£m)
32.2
P/E (fwd)
n/a
Yield (fwd)
n/a



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