Don't Miss Out on This Small Cap Stock With Massive Growth PotentialFEYE) and Palo Alto Networks (PANW) are down considerably this year as well.
Despite the woes, there is one company that depends on the sector that managed to perform well in 2015 as it ended the year up almost 20%, widely outperforming the market.
For those who don’t know about the company, Gigamon develops a solution that delivers visibility of traffic across networks. Its solution, Unified Visibility Fabric, consists of a distributed system of nodes that enables level of visibility, modification and control of network traffic.
Gigamon’s products are designed to aid network administrators to perceive and collect the appropriate network traffic they require without slowing down all of the other traffic. This is particularly essential for security purposes.
In 2015, more than 45 percent of the company’s sales were linked to security directly or indirectly, compared to just 36 percent in 2014. The company’s management presumes this to surge 24 percent this year. On the other hand, in its most recent quarter, the three largest new clients were all security related.
The most important thing is that the company does not compete with network security firms like FireEye, Fortinet or Palo Alto Networks. Relatively, they are complementary products, as the company’s appliances proficiently extract and forward the suitable data to this cybersecurity firms to deal with. As an alternative, the company competes against the old, existing switch providers like Cisco Systems.
Gigamon reported two successive quarters of outstanding growth and keeping in mind its forthcoming prospects, the company is a very attractive growth opportunity. At present, the company’s market cap is relatively small as compared to major cybersecurity firms. Therefore, this might be a pleasant opportunity to buy some shares, specifically before the company’s market cap gets larger.
Although Gigamon isn’t a pure play cyber security firm, it has many opportunities arising from this sector going forward. The company is growing at a brisk pace and the recent pull back can be used an as opportunity to buy the stock. Gigamon has been beating earnings estimates consistently and investors can expect it to continue delivering nicely going forward. As a result, I think investors should buy the stock at current levels.
Published on Feb 23, 2016By Akshansh Gandhi