Sourcefire Gains Ahead of Cybersecurity Order: Washington Mover
Feb. 12 (Bloomberg) -- Sourcefire Inc., a network security provider for government agencies and private companies, rose the most in more than three months on anticipation that President Obama will release an executive order on cybersecurity.
The shares advanced 7.4 percent to $43.06 at the close in New York for the biggest one-day gain since Nov. 1. Sourcefire, based in Columbia, Maryland, had declined 15 percent this year through yesterday, while the Standard & Poor’s 500 Index increased 6.4 percent.
President Obama is expected to issue an executive order aimed at bolstering U.S. cybersecurity this week following tonight’s State of the Union address, according to two former White House officials briefed on the plans. Sourcefire may benefit if Obama’s order requires agencies to invest in cybersecurity, said Frederick Ziegel, an analyst with Topeka Capital Markets Inc. in New York.
“Sourcefire has got a fairly large exposure to the federal government,” Ziegel, who has a hold rating on the stock, said in an interview. It remains to be seen whether the company will actually benefit from the order, he said.
About 28 percent of Sourcefire’s revenue came from U.S. federal and state agencies in the quarter ended Sept. 30, according to filings.
The Obama administration has been drafting an executive order on computer security since at least last fall. Obama has said water-treatment plants, railway systems and other assets that serve millions of Americans need greater protection from hackers.
“You’re going to have to see what the details of what the executive order are,” said Ziegel.
Sourcefire is scheduled to report earnings after the market close on Feb. 21.
--With assistance from Eric Engleman and Michael Riley in Washington. Editors: James Callan, Niamh Ring