This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Five Lessons From a Winning Stock Play

Larsen Kusick is a research associate for the Stocks Under $10 service at TheStreet.com. For a more information about Stocks Under $10 and a free trial, click here.


Those who don't follow the small-cap sector are probably unfamiliar with Vasco Data Security (VDSI), one of the top-performing stocks in the group since the beginning of the year. Investors in Vasco have been rewarded nicely in 2007 as the company posted better-than-expected financial results in both of its quarterly announcements this year, first in February and again last week, helping shares log a hefty 82% gain in just over four months.

Vasco is currently a Two-rated holding in the Stocks Under $10 model portfolio, meaning that we believe there's still enough upside to continue holding the stock, but that the risk/reward profile is not good enough to recommend additional purchases at the current price level. Nevertheless, investors can learn a number of valuable lessons by taking a look back at the company's progress in the almost two years since it became part of the model portfolio.

Lesson No. 1: Products and services meet a growing need.

Early on, Vasco positioned itself as one of the leading providers of security products -- both hardware and software -- aimed at preventing identity theft through user authentication.

Companies across the financial industry use Vasco's tokens and software to defend against sophisticated criminals trying to gain access to their databases and their customers' personal information. The growing need for security measures beyond simple passwords has helped Vasco post revenue growth of 83% in 2005 and 39% in 2006, with analysts' expectations pointing to a 55% gain in 2007.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,912.11 -70.48 -0.42%
S&P 500 1,969.95 -8.96 -0.45%
NASDAQ 4,442.6980 -2.2110 -0.05%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs