The NEXT company in my ongoing series of the Top 25 Stocks for the NEXT 25 Years is Blue Coat Systems, Inc. (NASDAQ: BCSI). This Sunnyvale, California based company has a current market capitalization of $625 million and was founded in 1996 as CacheFlow, Inc. CacheFlow changed its name to Blue Coat Systems in 2002.

Blue Coat Systems makes appliances and client-based solutions that allow organizations the ability to enhance security and accelerate performance for their networks. Its key product set is the ProxySG family of appliances, which improve existing authentication systems right down to the actual user. ProxyAV is an anti-virus appliance that allows enterprises to scan for viruses, spyware, worms and Trojans at the internet gateway level and at the email level. The product is designed to detect these viruses that bypass existing virus-scanning devices.

Blue Coat also manufactures and sells a suite of Blue Coat RA appliances that offer the ability to extend application connectivity to remote users such as employees and customers. The company has a set of products named Blue Coat WebFilter that helps enterprises and service providers protect their users from internet threats such as P2P traffic, streaming traffic, phishing attacks and spyware. To top it all off, Blue Coat offers a product that helps enterprises manage the entire set of products with a reporting product that logs all data to produce a customized report for management.

Blue Coat's marketing and sales structure is through value-added resellers and systems integrators. Their customer base is worldwide and growing. The value added by Blue Coat gives comfort to enterprises that it can protect an organization from a departmental level to the whole organization. Often, the head of IT at an organization will test a "suite of products" with one department first before widely implementing it. Blue Coat has seeded many new customers in just this fashion.

With the internet's exponential growth worldwide, security, authentication and protection have become priority spending items on many enterprises' agendas. Protecting corporate assets and data is almost more important than locking the front door!!

Blue Coat is positioned for growth in this ever-evolving area of protection. Blue Coat spends almost 17% of its revenues on research and development as it keeps its products new and cutting edge. Blue Coat has an April 30 fiscal year end. For April 30, 2008, I estimate Blue Coat will have revenues of $250 million with earnings per share of $1.53. For April 2009, my estimates are for revenues growing to $310-315 million with earnings per share of $2.20-2.25. For a point of reference, Blue Coat announced the April 30, 2007, year end with revenues of $177 million and earnings per share of $1.08. The growth rate is excellent and sustainable for the near future.

Blue Coat is properly positioned for the growth of enterprise-security spending. The company has established a worldwide network of distribution to sell and install its product set. Blue Coat Systems could be one of the top 25 stocks for the NEXT 25 years.