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About a year ago, ArcSight Inc. (NASDAQ: ARST) pulled off an IPO. For the tech sector, it was one of a handful of public offerings.
In fact, the company, which provides compliance and security management technologies, has done quite well since its debut. Revenues increased 30% and the company picked up more than 200 new customers. During this time, cash flow increased by $14 million.
And, the momentum has continued in the latest quarter. Revenues came to $36.4 million, up from $27.7 million in the same quarter a year ago. Cash flows were $7.8 million. In all, the company has $82.9 million in the bank.
ArcSight is certainly nicely positioned. Let's face it, compliance is critical in any economic environment. Actually, it could be even more important in tough times. After all, when laying off workers, there's a risk of fraud.
At the same time, the Obama Administration is likely to strengthen federal regulations, such as for cyber security, health care, securities, and so on.
The good news is that ArcSight provides a highly automated offering, which comes at an attractive price point. What's more, the technology has been leveraged into other products. Thus, ArcSight has increased the wallet-share of its existing customer base.
Looking at the next quarter, ArcSight forecasts continued growth, with revenues expected at $34 million to $38 million -- up 16% to 29%, respectively.
All in all, the future for ArcSight looks particularly bright -- both in the short and long term -- which is definitely a rare thing right now.
Tom Taulli is the author of various books, including The Complete M&A Handbook
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