Technology Investor 

Harry Newton's In Search of The Perfect Investment Newton's In Search Of The Perfect Investment. Technology Investor.

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8:30 AM EST Friday, November 10, 2006: Neat how oil went down virtually every day for 3 months before the election and has been up every day since. By the middle of the upcoming winter, we’ll be back to $80 a barrel. Buy futures.

Stock of the day:
The New York Stock Exchange -- also called NYSE Group, Inc, symbol NYX. I should have picked this earlier. It's had a nice run.

But I believe it will rise further for the following reasons:

1. Its earnings are booming and it's doing everything to make them boom more, including firing people and automating more.
2. No one is selling.
3. Cramer is pushing it.
4. Look what the Chicago Mercantile Exchange did.

Previous Stock of the Day: Absolute Software (ABT.TO) is doing well and should go higher. Fortune Magazine just did a piece on them

Computrace: LoJack for laptops
Canadian technology company Absolute Software is taking off, thanks to its recovery software for PCs.

NEW YORK (Fortune) -- When Starbucks announced late last week that two laptops - each containing personal data on thousands of employees - had gone missing from its Seattle headquarters, the latte purveyor joined a growing list of well-known organizations that have suffered an embarrassing, and potentially costly, computer security breach.

Starbucks (Charts) is not alone; In May, a Department of Veterans Affairs data analyst's laptop containing confidential info on 26.5 million veterans, military personnel and their spouses was swiped. Two months earlier, a laptop chock full of data on Fidelity Investments' clients was reported stolen. Ford, AIG and Ameriprise Financial have also suffered similar fates.

With laptops now capable of storing massive amounts of data, it's no surprise that they're increasingly targeted. Over half a million laptops are stolen each year, and very few are ever recovered, according to the FBI. In fact, 47 percent of computer security professionals surveyed recently by the Computer Security Institute and the FBI reported a laptop theft over the past twelve months.

To ward off the threat, companies large and small are beefing up spending on a host of security systems. A survey of corporate CIOs from analysts at Gartner found that information security budgets are expected to grow 4.5 percent in 2006, and will continue to grow "aggressively" through 2008. And 52 percent of respondents to a 2005 survey from market researchers In-Stat plan to purchase "security appliances" to replace out-of-date equipment, up from 22 percent in 2004.

One security tool that's becoming as ubiquitous as bike locks on city streets is Computrace laptop recovery and tracking software, made by a company out of Vancouver called Absolute Software. Founded 12 years ago, Computrace today protects over 800,000 computers and has helped everyone from San Francisco high school students to global accounting firms to Canadian oilfield equipment suppliers retrieve stolen or waylaid PCs.

Here's how Computrace works: If a PC is stolen, clients dial an 800 number or report the theft to Absolute via the Internet. When the stolen computer connects to the Internet, the Computrace software provides its location to Absolute's 12-person recovery team, which then works with local law enforcement to recover the PC. Clients can also, if they choose, remotely delete data post-theft.

Absolute has taken off over the past two years thanks to deals it has cut with top PC makers like Dell, HP, Fujitsu, Lenovo and Gateway to embed Computrace in the so-called BIOS on millions of computers. The BIOS (short for Basic Input/Output System) contains essential software code that allows computer components, like the keyboard and mouse, to function when first turned on, before the Windows operating system kicks in.

Being baked into the laptop makes Computrace almost impossible to remove, even if the hard drive gets wiped clean. (Previously, Absolute's software was offered as an add-on feature, requiring manual installation.)

The lion's share of Absolute's sales come via its PC partners, who pre-install Computrace and offer it to their corporate and educational sector clients. For example, Dell customer Quinnipiac University, just north of New Haven, Conn., has Computrace installed on all the Dell Latitude laptops that incoming freshmen are required to purchase.

"We needed to provide better asset management and theft deterrence," says Fred Tarca, the school's director of administration and operations. Tarca's office also uses Computrace to keep tabs on the 700 or so laptops utilized by faculty.

When a handful of faculty laptops were stolen from a locked room at Quinnipiac last year, Absolute's recovery team -- headed by a former member of the Royal Canadian Mounted Police -- identified the exact location of the machines and worked with local and campus police to retrieve them.

Sometimes, a stolen laptop can bust open a wider criminal ring, as was the case in North Carolina not too long ago, when a stolen Dell laptop was found, allegedly, alongside large amounts of cocaine and marijuana.

Drug busts make for great headlines, but much of Computrace's value comes from simply letting people like Tarca know where all his laptops are at any given time, and if they've recently caught a nasty virus or some spyware, for instance. (He only does this for university-owned machines, not the laptops bought by students.)

Computrace also battles so-called laptop "drift," which occurs when a laptop is lost but not reported stolen. For example, one of Quinnipiac's laptops mysteriously ended up in Israel.

A full 77 percent of Absolute's sales come from corporate and educational clients like accounting firm Grant Thornton, network equipment maker 3Com and Quinnipiac, but Computrace is also making inroads with consumers, who can purchase a three-year service contract for $99 at stores like CompUSA, Fry's Electronics and Office Depot.

In a savvy marketing move, the company has even licensed the LoJack (Charts) brand name to enhance its mainstream appeal, and Wal-Mart recently offered a two-year subscription to "LoJack for Laptops" with the purchase of select Gateway eMachine notebooks. Sales to government agencies are meager right now, but NASA is a longtime client and the company is due to announce more deals in that arena soon.

While Absolute's revenues are climbing, up 54 percent in its most recent quarter, the company is still not profitable and has pushed back its timetable for getting out of the red. But that doesn't worry analysts like Spencer Churchill at Clarus Securities, who rates the stock, traded on the Toronto exchange, as a buy: "We would rather Absolute continue to aggressively grow the business and embed itself in the food chain as a standard part of PC security," he says. "Absolute is firing on all cylinders and is the clear leader in this niche of the PC market."

That market niche stands at about $1 billion today and is growing at between 25 and 30 percent annually, says Churchill, who adds that, if you include desktop computers -- Gateway now embeds Computrace in its desktops -- as well as PDAs and smart phones, the potential market expands even more significantly.

For the full article, click here.

Monday's stock of the day will be Ziopharm Oncology (ZIOP). I visited with them yesterday and was impressed. They've just licensed a third drug. They're holding an Analyst Meeting next Friday. More on Monday.

Imagine what we could do with the money... The U.S. armed services have requested a staggering $160 billion supplemental appropriation to fund the wars in Iraq and Afghanistan in the remainder of fiscal year 2007. The request far exceeds the $94 billion supplemental authorized earlier this year to fund the ongoing wars as well as hurricane recovery in the Gulf and is nearly double the $82 billion Iraq war supplemental outlay of 2005.

If the money gets approved, small defense contractors, such as DRS Technologies, Essex and Armor Holdings will benefit.

Turn your young daughter on Gardasil

Merck's Gardasil can save your daughter's live. Gardasil protects vaccine against four types of human papillomavirus, which account for the vast majority of the 500,000 cervical-cancer cases and the 32 million new cases of genital warts around the world each year. Available for girls ages 9+, the three-shot regimen is best taken before sexual activity starts. Gardasil is a miracle vaccine. It will absolutely save lives. You need to do this.

Classic classified.

Motorcycle for sale:

$10,000. 06' Suzuki GSXR 1000. This bike is perfect! It has 1000 miles and has had its 500 mile dealer service. (Expensive) It's been adult ridden, all wheels have always been on the ground. I use it as a cruiser/commuter. I'm selling it because it was purchased without proper consent of a loving wife. Apparently "do whatever the f*** you want" doesn't mean what I thought. Call me, Steve. (801) 867-8292.

I called Steve last night. The bike has been sold. He's still married.

Some things in life are, fortunately, still free:

The wonderful memorial stone. A woman's husband died. He had left $30,000 to be used for an elaborate funeral. After everything was done at the funeral home and cemetery, she explained to her closest friend that "there is absolutely nothing left of the $30,000."

The friend asked, "How can that be?"

The widow responded, "Well, the funeral cost was $6,500. And, of course, I made a donation to the church. That was $500. I spent another $500 for the wake, food and drinks -- you know. The rest went for the memorial stone."

The friend said, "$22,500 for the memorial stone? My goodness! How big is it?"

The grieving widow replied, "Four and a half carats."

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads. Thus I cannot endorse any, though some look mighty interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Claire's law school tuition. Read more about Google AdSense, click here and here.
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