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Based in Redwood City, CA, Qualys (NASDAQ:QLYS) scheduled a $91 million IPO with a market capitalization of $360 million at a price range mid-point of $12 for Friday, September 28, 2012.

For the week of October 1, 2012 seven IPOs are scheduled. Full IPO calendar available here.

S-1 filed September 21, 2012

Manager, Joint Managers: J.P. Morgan; Credit Suisse.
Co Managers: RBC Capital; Pacific Crest; Baird; JMP; Lazard; First Analysis.

QLYS provides cloud security and compliance solutions that enable organizations to identify security risks to their IT infrastructures.

Buy QLYS on the IPO & sell asap, because growth appears to be slowing

For example: can QLYS achieve significant internal growth from increasing applications usage within its current customer base? Looks like at this stage it will not be easy to expand significantly by adding new customers.

Consider this statement on page 53 in the S-1 filing: "We will need to increase the revenues that we derive from our current and future solutions other than QualysGuard Vulnerability Management for our business and revenues to grow as we expect."

In the last six quarters QLYS made money for the first 3 quarters, but for the most recent 3 quarters QLYS lost money. Also, the rate of quarter increase in revenues seems stalled at 5%.

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Financial term glossary

QLYS is pioneer and leading provider of cloud security and compliance solutions that enable organizations to identify security risks to their IT infrastructures, help protect their IT systems and applications from ever-evolving cyber attacks and achieve compliance with internal policies and external regulations.

Organizations can use QLYS's integrated suite of solutions delivered on the QualysGuard Cloud Platform to cost-effectively obtain a unified view of their security and compliance posture across globally-distributed IT infrastructures.

QLYS's QualysGuard Cloud Platform is currently used by over 5,800 organizations in more than 100 countries, including a majority of each of the Forbes Global 100 and Fortune 100.

Reflecting this growing demand for next-generation solutions, International Data Corporation, or IDC, a research firm, forecasts that the vendor revenue tied to Cloud Security based solutions and for all types of Security & Vulnerability Management solutions will grow from a combined $5.1 billion in 2011 to a combined $9.3 billion in 2015, representing a CAGR of 15.9%.

QLYS derived 96%, 92%, 90% and 88% of revenues in 2009, 2010, 2011 and the six months ended June 30, 2012, respectively, from subscriptions to its QualysGuard Vulnerability Management solution.

QLYS relies on a combination of trade secrets, copyrights, patents and trademarks, as well as contractual protections, to establish and protect intellectual property rights and protect its proprietary technology.

QLYS has several pending U.S. patent applications and an inbound license to four U.S. patents, which was obtained in connection with QLYS's acquisition of Nemean.

QLYS competes with large public companies, such as Hewlett-Packard (NYSE:HPQ), Imperva (NYSE:IMPV), International Business Machines (NYSE:IBM), McAfee subsidiary of Intel (NASDAQ:INTC) and Symantec (NASDAQ:SYMC),

as well as private security providers including Barracuda Networks, Inc., BeyondTrust Software, Inc., Lumension Security, Inc., nCircle Network Security, Inc., NetIQ Corporation, Rapid7 LLC, Tenable Network Security, Inc. and Trustwave Holdings, Inc.

As of June 30, 2012: 334

Pre-IPO 5% Stockholders:
Trident Capital, Inc. entities: 27%
GRP Partners entities: 11%

QLYS expects to net $72 million from the sale of 6.7 million shares. Selling stockholders expect to sell 875,000 shares.

IPO proceeds are allocated for capital expenditures, working capital and other general corporate purposes.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Disclaimer: This QLYS IPO report is based on a reading and analysis of QLYS's S-1 filing, which can be found here, and a separate, independent analysis by There are no unattributed direct quotes in this article.