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Annotated article summary from this weekend's Barron's. Receive all our Barron's summaries by signing up here:

The Purest Play in Network Security by Mark Veverka

Summary: The top player in the enterprise firewall market, Secure Computing (SCUR) has good reason to feel secure. With about a 17% share in this segment of the rapidly growing world of network security, the company is seen as a good buy these days. Rivals of all sizes cater to mostly consumer security needs, while Secure serves huge corporate and government clients. Following stellar fourth quarter earnings, shares topped $9 in February, settling back to $8 last week, in reaction to a Sell rating from Goldman Sachs for a seemingly high valuation. Joel Fishbein, Lazard Capital Markets software analyst, is among those who see this as an opportunity. He estimates the company could earn 53 cents a share in 2008, well above the 44 cent consensus estimate. Tireless efforts by hackers are predicted to cause companies to more than double the current 3% to 7% of their IT budget on fending off attacks. Secure Computing provides the solutions; its main firewall product has never been breached, and CEO John McNulty ensures a constant flow of innovative security solutions. The company offers means to not only protect a network itself, but data within the network as well, an appealing feature to huge corporate clients. With over 19,000 customers, bulls think the company can build a durable business that can survive consolidation moves in a fast-growing market.
Related Links: Secure Computing: Weak Government Spending Could Hamper ResultsSecure Computing Shares SlideSecure Computing CEO Buying Stock

SCUR 1-yr chart

scur chart

Source: Secure Computing Has "The Right Products At The Right Time" - Barron's