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Gold/Mining/Energy : Certicom Corporation (TSE:CIC, NASD:CERT) -- Ignore unavailable to you. Want to Upgrade?

To: tom ablett who wrote (2452)	12/5/1999 2:59:00 PM
From: bugssy	Read Replies (1) \| Respond to of 4913

if your wondering about the nasdaq listing check the last paragraph of this news article from the national post Analysts still positive on high-flying Certicom Paul Bagnell Financial Post With an explosive week-long rally just behind it and a value-destroying crash in its longer-term past, what lies ahead for the stock of Certicom Inc.? Analysts remain convinced Mississauga, Ont.-based Certicom, a developer of encryption software, remains a good bet in the volatile world of high-tech stocks. Last week, Certicom shares (CIC/TSE) rose 41.5%, to Friday's close of $26.75 from $18.90 a week earlier. The stock closed yesterday at $26.10, down 65½. Analyst Joe Vejvoda at National Bank Financial in Toronto has a "buy" recommendation on Certicom shares. He has a $30 target on the stock, and says he may return to an earlier $40 target. Brandon Osten at Sprott Securities Ltd. in Toronto is now reviewing his $26 target, and rates the stock a "speculative buy." Certicom develops encryption software used to build security into Internet applications and wireless communications devices. It specializes in "elliptic curve cryptography," considered to be the field's leading technology. The company has licensed its products to firms such as Hewlett-Packard Co., Palm Computing Inc. and Pitney Bowes Inc. Three new licensees have been added during the past three weeks. Last week alone, Certicom announced agreements with Nettech Systems Inc., a New Jersey-based developer of mobile communications technology, and The Edge Consultants, a provider of online-business expertise based in Singapore. And star performers such as Verisign Inc., a provider of secure electronic transactions, use Certicom technology. Verisign shares (VRSN/NASDAQ) closed at $173 (US) yesterday, up from $18 5/8 a year ago. "What people are starting to latch on to, I think, is that we are really the common thread that goes through all the interesting wireless and Internet appliance companies out there," says Philip Deck, Certicom's chief executive. Mr. Deck is confident Certicom can dominate the wireless and Internet security field. He says Certicom should be able to maintain its 30% quarter-to-quarter revenue growth -- something it has achieved for five straight quarters -- at least in the short term. "We're comfortable that it will continue for the foreseeable future." With a stable cost base, Certicom should make its first operating profit early next year, Mr. Deck says. Mr. Vejvoda says Certicom shares are cheap compared to those of some companies using its technology. The comparison is important because Certicom takes a royalty stake from its client companies as part of its licensing agreements. Mr. Vejvoda says he may eventually raise his $30 price target on the stock to his earlier $40, but Mr. Osten is less ebullient. "There is a lot of risk in it right now," he says. "But the near-term prospects seem pretty bright." Mr. Osten points to steady sales of Certicom's SSL encryption tools, one of its key products. But an important question facing Certicom is what happens when patents held by its chief rival, RSA Security Inc., expire next year. Anyone, including Certicom, will be able to make use of key RSA encryption technology. Mr. Vejvoda views the expiry of RSA patents as a positive. "It allows them to take RSA technology and their own, bundle them together and provide both of them for the price of one." Certicom and RSA are the only companies certified by the American National Standard Institute for their financial-transaction encryption technology. But Mr. Osten says the expiry of the RSA patents may put price pressure on Certicom and its products. And, with a market capitalization of roughly $250-million and sales of just $3-million a quarter, Mr. Osten does not consider Certicom shares to be a bargain right now. Certainly, the company's stock has provided disappointments in the past. Late last year, the shares collapsed to $8.10. Investors who bought in anywhere near Certicom's 1998 high of $41.50 suffered huge losses. The crash came after expectations that "smart cards" would begin sweeping aside traditional credit and debit cards in the banking industry proved to be premature. Certicom technology can be used in smart cards, chip-bearing cards that combine credit, debit and other financial functions. The shares quickly rallied from $8.10, but spent most of this year in a slow decline before heading up again in September. Last week, investors came rushing back to the stock on hopes the flurry of recently announced licensing agreements will boost the company's already robust revenue growth. Certicom is also rumoured to be close to a listing on the Nasdaq, something Mr. Deck said is indeed in the company's plans. A listing on Nasdaq, which has been hitting record highs, would raise the company's profile among U.S. investors and analysts. CERTICOM CORP. CEO: Philip Deck Ticker: CIC Listed: Toronto Stock Exchange Head office: 200 Matheson Boulevard. W., Mississauga, Ontario, L5R 3L7 Telephone: (905) 507-4220