+ Watch KEYW
on My Watchlist
KEYW has a low P/S valuation relative to its peers in the cybersecurity industry which is set to grow exponentially as the internet of things take off this decade. It could also become a takeover target within the next couple of years at a significant premium to the current stock price.
My consulting has allowed me some interface with KEYW and the closer one gets, the more impressed. I believe the expertise and integrity of management and essential nature of their services in cyber security will offset considerable negatives: They are acquiring businesses with complementary services for shares, resulting in a lot of good will degrading the balance sheet, dilution and management integration challenges. Not sure if their focus on clients' needs doesn't makes them like the mythical cobblers too busy to make shoes for their children, not sure they have any focus on bringing in a profit. Also the nature of their business makes quarterly earnings hard to predict and new business awards are intermittent and hard to predict or time. Offsetting this is my knowledge they have nearly indispensable expertise in a cyber warfare space which is even worse than all the press about it, and the management has an attitude of forthrightness toward shareholders and focusing on cash flow rather than reported GAAP earnings.
KEYW Holding Corp. is an IT firm that specializes in cyber security and has contracts with NSA, DoD, and number of classified organizations. With the US beginning to acknowledge the serious threat being posed by cyber warfare, KEYW stands to benefit from increased expenditures on cyber security since they already have several government contracts. YoY revenues are up 175% and they have no debt.
I think we are near the material beginning of an ongoing "cyber war" against forces unknown (see: Wikileaks). KEYW serves the US Intelligence Community, employs a small army of high clearance individuals, is nicely profitable and growing. Relatively obscure at this point and new to the equity markets, I think the direction is likely up.
right company in the cyber security business and proven top of the line management
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