Endace Share Discussion Threads

[knackers] 02/11/2011 16:39

Endace US industry peer Sourcefire is up 12% today. Underlines the accelerating growth in this sector (FIRE mcap approx $900m). NB Endace supports the SURICATA open source IDS project (OISF), this s/w is widely regarded at the natural successor to Sourcefire's somewhat dated SNORT IDS engine.


Sourcefire, Inc. (Nasdaq:FIRE), a leader in intelligent cybersecurity solutions, announced financial results for its fiscal third quarter ended September 30, 2011.

"Our record quarterly revenue and adjusted net income were the result of broad based strength across our business. Our Commercial and International businesses continued their strong performance while our Federal business benefited from increased spending as the Federal Government closed out its fiscal year and made our solutions a funding priority, said John Burris, CEO of Sourcefire. With our Agile SecurityTM vision, which emphasizes the need for more informed, adaptive, and automated security, and the upcoming availability of our expanded solutions, we have the opportunity to take on an even larger role in our clients' security infrastructure.

Financial Summary

Total Revenue - Revenue for the third quarter of 2011 was $45.2 million compared to $36.2 million in the third quarter of 2010, an increase of 25%.
GAAP Net Income - Net income was $2.0 million for the third quarter of 2011, or $0.07 per diluted share, on the basis of generally accepted accounting principles (GAAP), compared with GAAP net income of $4.2 million, or $0.15 per diluted share, in the third quarter of 2010.
Adjusted Net Income - Adjusted net income for the third quarter of 2011, which excludes stock-based compensation expense, amortization of acquired intangible assets and other acquisition-related expenses, and includes an assumed tax rate of 35%, was $5.7 million, or $0.19 per diluted share. This compares to adjusted net income of $5.2 million, or $0.18 per diluted share, in the third quarter of 2010, which excludes stock-based compensation expense and assumes a tax rate of 35%.

Sourcefire, Inc., a world leader in intelligent cybersecurity solutions, is transforming the way Global 2000 organizations and government agencies manage and minimize network security risks. With solutions from the network to the endpoint, Sourcefire provides customers with Agile SecurityTM that is as dynamic as the real world it protects and the attackers against which it defends. Trusted for more than 10 years, Sourcefire has been consistently recognized for its innovation and industry leadership with dozens of patents, world-class research, and award-winning technology. Today, the name Sourcefire has grown synonymous with innovation, security intelligence and agile end-to-end security infrastructure.

[knackers] 02/11/2011 14:53

"Newcomers" must realise this stock is almost completely locked-up with the original founders, quality Instl investors, directors, staff and non execs. PIs hold no more than 4-5% of the company (thank heaven!)

Also that several hundred thousand options are currently fully vested/active and well above water...and yet how many option sale/exercise RNSs have we seen in the last 6-12 months...? Ans: Next to none.

Based on today's action, I'd think the 'story' currently doing the rounds of Insts is going down rather well ;o). To recruit an industry heavyweight of Spencer's calibre says it all in spades. FWIW I still think there's more news in the wings, beyond the imminent 100gb/s launch.

[hvs] 02/11/2011 14:18

Pre-tax profit of US$0.2 million, after adjusting for share options

Says it all really.

[hvs] 02/11/2011 14:17

lol !!!!!

He who laughs last ??? Any one know ?

[mikepompeyfan] 02/11/2011 13:41

hvs was already on my filtered list - just a troll

[knackers] 02/11/2011 13:33

LOL!

hvs: FILTERED

[tehmac] 02/11/2011 13:04

Looking at his posting history it seems that all he does it bash stocks and people. Just a deramper. Ignore him.

[edwardt] 02/11/2011 12:51

hvs - prey tell why?! It appears a genuine growth stock in a world where growth is rarer than hen's teeth

[hvs] 02/11/2011 12:37

I would not touch THIS with a BARGE POLE.

Watch what happens next.

[edwardt] 02/11/2011 12:20

all very exciting price action. Let's hope the analyst presentation tomorrow can offer some further legs to this.....

[knackers] 02/11/2011 10:34

Well at the moment cybersec companies in the US are being acquired at between 5x and 10x current yr sales expectations. Fair value I'd put at half that. So at the low end (5x) and assuming ~$50m revenue for the FY:

$250m/1.6 (exchange rate) = £156m
£156m/17.5m (shares issued+options) = £9

So by this year end (Mar/Apr) we should be moving towards £8...and then we need to look beyond as next year's revenue target will be £65-70m. But if the Govt sector starts to motor then frankly all bets (in terms of attempted valuation) are off. This is a Tech Co slap bang in the middle of it's growth phase with a game plan to break into the mainstream. If they can achieve that and fully exploit the US market, again all bets are off. You have an Autonomy on your hands (no ramp intended).

In all this of course the key consideration is just how much a really BIG player like Cisco, IBM, Juniper etc would be prepared to pay for them. Or rather, how much value can they realise from acquiring them...?

Certeris paribus I think Endace can look fwd to a premium valuation at acquisition poss in the next 18 months. I'll let you do the fwd math but it's a pretty academic exercise. If the tech is that good, echo the acq price!

FWIW I don't think they're for sale any time soon - the story is now too strong/too good and Inst'l holders, I'm sure, will be holding on from here on in. L&G, Blackrock etc will be feeling pretty pleased with themselves. Those guys absolutely nailed it.

[edwardt] 02/11/2011 09:31

I suspect the Panmure upgrade is helping too. Knackers - any views on what is fair value say on a ev /sales valuation when you compare to say some of the US peers? I suspect that the valuation gap may remain quite wide?

i wish all my stocks were behaving like this one!

[knackers] 02/11/2011 09:02

I see Neil has freed-up a wee bit more stock for the Insts - good for him - but can't see other major holders willingly handing over bundles of stock at these prices.

[knackers] 02/11/2011 08:21

Not the best articulation of the Endace platform (6/10 for effort) but good to get a mention all the same:

[mikepompeyfan] 02/11/2011 07:11

Found a small mention in The Mail today but nothing else :-

Endace, the network monitoring and security group, jumped 20p to 512.5p on excellent interim results. Its cyber-security kit is used by governments and financial institutions and for key infrastructure protection.

Fortunately the results and progress being made talk for themselves. No need for ramping here.

[knackers] 01/11/2011 19:24

Thanks Aspex YHM via Hamish ;o)

[aspex] 01/11/2011 19:00

Knackers,
Done.

[knackers] 01/11/2011 17:49

Tehmac - welcome. Yup, that certainly confirms it today :o)

Aspex, I know it's early ;o) if you didn't see my earlier post, you've mail at T2W! Speak later.

[tehmac] 01/11/2011 17:35

Just broken out into new all time highs above 500p. BREAKOUT!

[knackers] 01/11/2011 17:05

MMs getting themselves a tad hot 'n' bothered towards the close. Shares incredibly closely held - one wonders why ;o)

Here's another from my E.L.O. cybersec collection - just for the MMs ;o)

[knackers] 01/11/2011 14:18

Firms lose 12% of brand value from data breaches. Ponemon/Experian research survey finds:

[knackers] 01/11/2011 11:06

Endace's enviable growth:

[knackers] 01/11/2011 10:10

Pull-out section on cyber security in today's FT, seems comprehensive. Will share anything significant later this am.

Just listening to the UK Cyber conference live stream interesting panel discussion on freedom, privacy, protecting the vulnerable, new regulatory frameworks etc.

[knackers] 01/11/2011 09:12

Indeed, Aspex ;o) You have email at T2W - be good to catch-up!