RSA Security Inc. (RSAS) rose nearly 12% on rumors that the computer security company may obtain a significant piece of new government business, an analyst said.
"The buzz is they have a good chance" at obtaining a substantial part of a security contract to cover 2 million government users, SG Cowen analyst Peter Kuper said.
RSA provides secure computer access in part through the use of hardware tokens that are normally priced at about $45 a unit. Total 2001 revenue is expected at about $286 million, according to Thomson Financial/First Call.
Two other analysts hadn't heard the contract rumor, and didn't know of any news that could account for the stock's increase.
Todd C. Weller of Legg Mason Wood Walker said the company's shares may be in catchup mode in relation to other computer security companies, whose shares he said have been rising in recent days.
Similarly, Steven M. Ashley of Robert W. Baird & Co. said the shares fell steeply in October to a year low of $6.79 a share after the company disclosed it lost $13 million on put options held on its own shares.
"It was a financial faux pas, but it was overdone," Ashley said of last month's meltdown.
RSA Security Inc. traded recently at $15.08, up $1.72, on volume of 3 million shares. Average daily volume is 2.2 million shares.
John Seward; Dow Jones Newswires; 2019385400
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