CTCH - Commtouch Software Ltd.

[Henrique Costa]

Profile: Commtouch Software Ltd., through its subsidiary, Commtouch Inc., develops and provides email defense solutions to enterprise customers, and original equipment manufacturer licensees and enterprises. Its solutions include anti-spam, virus outbreak detection, and global view mail or Internet protocol reputation services, as well as Web security engine solutions. The company also offers product Recurrent Pattern Detection technology, which analyzes messages associated with mass email outbreaks and directs the blocking of such emails without the need to analyze individual messages; and URL filtering solution that analyzes various feeds from worldwide sources pertaining to URLs. In addition, it offers a software development kit comprising various components, which enable third-party vendors to integrate anti-virus applications, content filtering solutions, firewall systems, security servers, and other network appliances; and an enterprise anti-spam and Zero-Hour virus outbreak detection solution, which includes a software element or the Enterprise Gateway, and a service component, or a Commtouch Detection Center.
Market Cap: 70M
Website:  http://www.commtouch.com/

Trading Thesis:

Mid term speculative play, based on TA and FA.

- Interesting product with increasing global demand, the company has strong growing sales with good prospects for recurrent sales. I personally believe that we'll watch consistent earnings surprises in the quarters to come.

- Zacks recently posted an EPS FY11 of $0.21 which makes this company very cheap when compared with some of it's peers.

- Technicaly CTCH is treding up and breaking an important resistance level, which can lead it to another up swing.

Trading Plan:
Buy for both portfolios today at the open, sell @ $4