3SOF

I don't have time now to make a full video analysis before the open, but I want to recommend ALDN to buy today. The valuation model results show me a 46.9% share price CAGR and an optimal selling price of $38.61. The stock closed at $19 on Thursday:



I liked it even before the big news on Thursday and today:

• Aladdin Knowledge Systems Wins Deal to Supply Up to 3.8 Million Indian IT Students with eToken Authentication Keys Call scheduled for 8:30 am ET today
CCBN (Thu, Apr 5)

• Unisys to Deploy 28,000 Aladdin eToken Smart Cards for Integrated Physical/Data Access
PR Newswire (Mon 6:30am)

This is a $278 M software security company with 16% net profit margin. These two headlines and the hearing of Thursday's conference call tell me revenue growth will accelerate to 30% or more. There are no specific details, revenue growth can be a lot more or somewhat less. Either way, as I said in the beginning, I would love it even before the recent news.

I'll complete this analysis with more details over the upcoming updates.

The Trading Plan is:

Buy 6.66% of capital in ALDN.

as always  :
1)
Aladdin Knowledge Systems "buy," target price raised
Tuesday, January 23, 2007 1:50:05 AM ET
Dougherty & Company
NEW YORK, January 23 (newratings.com) - In a research note published yesterday, analysts at Dougherty & Company reiterate their "buy" rating on Aladdin Knowledge Systems Limited (ALDN.NAS). The target price has been raised from $18.50 to $20.
2)
Aladdin Knowledge Systems "buy," target price raised
Thursday, April 05, 2007 3:15:27 PM ET
Lazard Capital Markets
NEW YORK, April 5 (newratings.com) - Analysts at Lazard Capital reiterate their "buy" rating on Aladdin Knowledge Systems Limited (ticker: ALDN). The target price has been raised from $22 to $24.

Attached you will have the Quarterly Total Revenue (unaudited), EPS Per Quarter (unaudited) and Yearly Cash Flow From Operations (unaudited).

regards
Oliver

fyi another upgrade:
Aladdin Knowledge Systems    ALDN    Dougherty & Company    Buy    $20 » $27

Thanks for posting analysts views La-Onda

I made the complete in depth video analysis for ALDN, which you can find at our Video Analysis section.

Current estimates and model results came in a bit better than on my initial post. Here's my current view of the future, based on the video analysis:



I'll keep holding ALDN.

I'm short on time for these updates today, but over the following ones I want to know this company's products better. As I look around its website I like what I see: www.aladdin.com

I'll keep holding ALDN.

Over the next few updates I'll go over the various phases of deriving estimates for ALDN. Even though I did it on the video analysis posted on the second update, it doesn't harm to do it again, step by step.

Since I'm always getting late to this ALDN update, starting tomorrow, I'll start from the bottom of the Main Portfolio to the top, the next day from the top to the bottom, next from the bottom to the top, and on and on. This way I make sure I cover all stocks in the same way.

I'll keep holding ALDN.

 
cheers
Oliver

Aladdin Knowledge Systems Announces Share Buy Back Program
Thursday April 12, 7:55 am ET
Board of Directors authorizes share repurchases of up to $10 Million

TEL AVIV, Israel, April 12 /PRNewswire-FirstCall/ -- Aladdin Knowledge Systems, Ltd. (Nasdaq: ALDN - News), the leader in Software DRM, strong authentication and content security solutions, today announced the Company's Board of Directors has authorized the use of the Company's available cash to repurchase its ordinary shares periodically in the open market, based on market conditions, share price and other factors. Aladdin is authorized to repurchase Ordinary Shares of the Company for an aggregate purchase price not to exceed $10,000,000 or for a maximum aggregate of 500,000 shares.

Yanki Margalit, Chairman and CEO of Aladdin Knowledge Systems, stated, "Aladdin's Board of Directors has approved the share buy back program based on the Company's strong cash flow from operations, healthy cash position and the fundamental value the Company believes is represented in the current share price. Today's announcement demonstrates Aladdin's commitment to enhancing long-term value for all our shareholders."

Purchases shall be made in compliance with the applicable provisions of Section 302 of the Israeli Companies Law, 1999, the applicable provisions of Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and Regulation M promulgated under the Exchange Act. In accordance with the Israeli law, shares to be purchased by the Company under the buy back program shall not confer upon the Company any voting rights (although entitle the Company to participation rights upon distribution). As of March 31, 2007 Aladdin had approximately 14,691,738 ordinary shares outstanding.

Thanks for posting that excellent news for ALDN la-onda. The CEO talked about the possibility of a share buy back program over the latest conference call, with one analyst insisting a lot on the issue, and now just a few days later we get this announcement:

• Aladdin Knowledge Systems to buy back up to $10 mln of shares
at Reuters (Thu 8:12am)

This news will prompt me to lower the dilution factor on my valuation model from 1.03 to 1:



The estimated share price CAGR is now 59.5% and the optimal selling price today is $52.01.

(now I see that on the previous model calculation there was an error in a formula, the EPS
estimate was considering the initial share count instead of the final share count, that's why you see no improvement from the previous model calculation, but there was an improvement)

ALDN has been moving higher ever since I bought it, as fundamental analysis shows the stock is way undervalued. I'll keep holding ALDN. 

David, ALDN seems to be a great pick. However, I think it will be very useful if we can have optimal selling price for each holding during each update, this will ensure weak hands and will help new subscriber to put money where they can feel more bang for the buck. Or, it can find its way into the portfolio tables. Again this will be very helpful.

Quote from: stocky on April 13, 2007, 02:20:32 AM
David, ALDN seems to be a great pick. However, I think it will be very useful if we can have optimal selling price for each holding during each update, this will ensure weak hands and will help new subscriber to put money where they can feel more bang for the buck. Or, it can find its way into the portfolio tables. Again this will be very helpful.

Yes stocky, we're already getting to that optimal organization, but thanks for reinforcing the utility of showing/running the valuation model for all updates on all holdings.

ALDN is the third of three Israeli companies in the Main Portfolio, and look how the other two (SILC and CIMT) have been performing

Israel, a very small country is benefiting a lot from globalization and free markets. These guys sure know how to make money, as they've been doing it for centuries.

Anyway, ALDN, a $292 M small cap, is truly undervalued, as one can see from my valuation model:



The expected share price CAGR is 60.1% and the optimal selling price today is $52.41.

Look how analysts have been raising their estimates for ALDN:



According to my estimates they'll need to revise those expectations even higher.

I'll keep on holding ALDN.

Slowly but surely ALDN keeps moving higher, correcting some of the inefficiency in its valuation, but my valuation model says I should keep holding ALDN until the optimal selling price, which currently stands at $52.37:



I'll keep holding ALDN.

ALDN keeps pushing higher, despite what some technical analysts could call an "overbought condition". I totally ignore "overbought" or "oversold" conditions, those are just terms to deviate a person from what truly makes him money, the technical trend and the attractiveness of fundamentals.

ALDN continues to close the gap between the current share price and the optimal selling price, but it is still a long way to go:



I'll keep holding ALDN.

Largest Chinese Provider of Intelligent Pattern Recognition Solutions Chooses Aladdin HASP
Wednesday April 18, 6:30 am ET 
Up to 18,000 Aladdin HASP keys to provide valuable anti-piracy protection and secure licensing capabilities for Beijing-based Hanwang Technology Co. Ltd.


CHICAGO, April 18 /PRNewswire-FirstCall/ -- Aladdin Knowledge Systems (Nasdaq: ALDN - News), the leader in Software DRM, USB-based authentication, and secure Web gateways, today announced that Beijing-based Hanwang Technology Co. Ltd., the largest provider of intelligent recognition solutions in China, will deploy up to 18,000 Aladdin HASP software protection keys to secure Hanwang products against piracy and unauthorized use.


(Logo: http://www.newscom.com/cgi-bin/prnh/20040416/CGALADDINLOGO )

Hanwang's innovative products, such as its latest Writing Tablet solutions, give users the power to quickly and easily input Chinese and Japanese handwriting into more than 100 software applications. The Aladdin HASP USB key allows Hanwang to sell and distribute their solutions as, when and where they need without compromising their products' security. Recognized as one of the top 100 Chinese industrial software companies, Hanwang is one of hundreds of HASP customers in China that rely on HASP's innovative licensing and protection capabilities to protect IP and ensure license compliance.

"As a company that prides itself on unique innovation, we employ only the strongest, proven technologies to assist in our business," said Mr. Li Zhi Feng, vice president at Hanwang Technology. "We are extremely satisfied with the performance and quality of Aladdin HASP solutions and highly value its reliability and security."

"Gaining well-known customers such as Hanwang, Aladdin HASP continues to experience ongoing growth throughout China," said Avi Barir, vice president of software DRM at Aladdin Knowledge Systems. "As China sprouts more and more leading software companies, HASP's presence in the region gains ongoing strength -- illustrating HASP's reliability, flexibility and market superiority. We're pleased to announce Hanwang as one of the latest Chinese software companies to select Aladdin HASP."


http://biz.yahoo.com/prnews/070418/aqw058.html?.v=7

Look'in good


Coverage Reit/Price Tgt Changed*

Aladdin Knowledge Systems    ALDN    Friedman Billings    Outperform    $22 » $25

uc.