Security Clearance for Saflink's I.D. Systems
Saflink (SFLK ) is on a tear. The tiny outfit makes biometric identification and authentication software for computer networks. Instead of passwords, it uses identifiers such as voice, fingerprint, or other physical features. Jumping from 1.40 in mid-May, 2002, to 4.55 on May 27, 2003. Saflink owes the rise to promising contracts: It aims to integrate its systems with the Defense Dept.'s millions of ID access cards. And Saflink has teamed up with Microsoft, Novell, and Computer Associates (CA ) to make the software applicable to their systems, says CEO Glenn Argenbright.
Saflink's involvement with government pilot projects, including one at the Transportation Security Administration, "marks the transition of biometrics from a niche technology to a reliable security method for Homeland Security," says Argenbright. James McIlree of investment firm C.E. Unterberg, Towbin, which has done banking for Saflink, says the Defense project could generate $100 million in revenues -- and Saflink expects to get a chunk of that, says McIltree.
He rates the stock a strong buy, with a price target of 6 this year, based on the projects in the pipeline. He expects a loss in 2003 on sales of $13 million but sees a 2004 profit of 7 cents on $35 million. In 2002, sales were $2 million.
Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them.
By Gene G. Marcial