Wedbush Morgan Upgrades Secure Computing

Analyst Horacio Zambrano believe's the IT security vendor's SmartFilter product will be used as part of McAfee's all-in-one appliance in the third quarter

Wedbush Morgan upgrades IT security vendor Secure Computing (SCUR ) to hold from buy.

Analyst Horacio Zambrano thinks the cmopany's strategy in taking its brand name down market and transitioning to an all-in-one appliance market is working and gaining momentum in channel.

According to his checks, the Federal market looks strong, unlike a year ago, and the channel is incrementally more positive on authentication products. He believes McAfee will use Secure Computing's SmartFilter product as part of its announced all-in-one appliance in the third quarter.

Zambrano ups his $107 2005 revenue estimate to $110 million and his $121 million 2006 revenue to $128 million. He also raises his 49 cents 2005 earnings per share to 50 cents and his 58 cents 2006 earnings per share estimate to 63 cents. He ups his $10 target to $14.

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