NW_20000925_en_Information Week, September 25, 2000_ "Check The Corners Of Security"

September 25, 2000

The Internet security boom has put the spotlight on publicly traded companies in the major Internet security arenas-encryption, firewalls, and public key infrastructure. But there are several companies in smaller segments and emerging niches that could offer high-risk, high-reward investment opportunities.

VASCO Data Security International (VDSI- Nasdaq) manages and protects access to business and government networks and secures E-business transactions. The company recently acquired Invincible Data Systems, which focuses on E-mail and disk encryption, access control utilities, and video-streaming encryption. VDSI is best-known for its IdentiSoft data-security token products used in authentication, but it's gaining ground fast in the authorization market through its IntelliSoft division, which makes up 72% of sales. The stock is priced at about $9, far below its 52-week high of $26. In the quarter ended in June, the company broke even on revenue of $6.5 million-up 21% year over year.