February 12, 2004 CyberGuard (CGFW)
Hello Friends! Thanks for stopping by! It looks like the DOW wanted to give back some of those gains yesterday and it sure did! Sort of two steps forward and one back imho. Remember to always do your own due diligence on these any any internet derived stock market idea. Also, use your own financial advisor liberally. (Conservatively if you are a Republican I guess.)

Was looking through the lists of stocks on the move today and came across this one a few moments ago, after the market was closed. I do not own any shares of this but it is worth our examination: CyberGuard Corporation (CGFW). According to Money.cnn.com "snapshot", CGFW "...is a developer and marketer of commercial network security products designed to protect data on computer networks from access by unauthorized users."

Looking at the second quarter 2004 earnings results, CGFW reported on January 27, 2004, that results for quarter ended December 31, 2003, showed revenues of $11.236 million, an increase of $3.003 million, or 36% over the 2003 results of revenue of $8.233 million. Net income for the quarter was $2.344 million or $.08/share vs $1.508 million, or $.06/share, a 55% increase in net income.

If we look at the "5-Yr Restated" financials on Morningstar.com, we find that revenue has been increasing steadily (except for a small drop in 2002), from $13.9 million in 1999, to $34.9 million in the trailing twelve months.

Earnings per share have also been improving each year from a loss of $(.90) in 1999 to a profit of $.16 in the trailing twelve months. The free cash flow has also improved from $(3) million in 2001, to $2 million in 2002 and $4 million in 2003.

Per Morningstar.com, the balance sheet is very clean with $15.5 million in cash, plenty to cover both the current liabilities of $13.6 million and the fact that there is NO long-term liabilities reported at all on the Morningstar page. In addition, CGFW has $9.0 million in other current assets.

Looking at "Key Statistics" on Yahoo.com, the Market Cap is listed at $260.61 million. The trailing p/e is high at 77.66, however, the growth is so fast that the PEG is only at 1.74. Price/sales a bit rich at 6.47.

Yahoo lists 21.79 million shares outstanding with 14.10 million of them that float. 532,000 shares are reported out 'short' as of 1/8/04. This represents 3.827 trading days or 3.77% of the float. No cash dividend is paid, and no stock splits are listed on Yahoo.

Taking a superficial look at technical indicators, we can see from the CGFW chart on stockcharts.com that the company has very steadily been appreciating in price for the last couple of years.

Overall, I like this stock a lot. I just picked up position #25 today...so there is no room in my portfolio for another position...besides the fact that my margin is up to my ears.

Thanks again for stopping by! I sure DO appreciate all of you who stop by and I would love to hear from you if you are a regular, or if you are new to this website....feel free to post right here or email me at bobsadviceforstocks@lycos.com

Regards!

Bob