Secure Computing Now a Safe Bet

Secure Computing's(SCUR Quote) $274 million purchase of CipherTrust last year seems to be paying off.

The San Jose, Calif.-based IT security company launched new products last week driven by TrustedSource, a "reputation-based" service that prevents spam and phishing, which Secure acquired from CipherTrust in July.

TrustedSource is our "secret sauce," says Secure Computing CEO John McNulty.

With IT companies looking for a reliable way to distinguish spam, TrustedSource could not only give Secure Computing's products an edge but also help them become an industry standard through licensing deals.

Among possible partners are McAfee(MFE Quote), CA(CA Quote) and Juniper Networks(JNPR Quote).

For investors, that idea -- and Secure's fourth-quarter results earlier this week -- showed promise. Since the results, the stock has jumped nearly 30%. Last week, Secure Computing received two upgrades from Soleil Securities and Lazard Capital, both of which upgraded it to buy from hold.

Shares of Secure closed Tuesday's regular session off a penny to $8.82.

The company is still trading down about 40% from its 52-week high of $14.81.

For the fourth quarter, Secure said revenue grew 71% to $51.6 million from $30.2 million in the same quarter last year. Excluding charges, revenue was $63.2 million.

Net income was flat compared with the same quarter last year, as well as with analysts' expectations.