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Turnaround at Infoblox
08/25/2011 7:00 am EST
Increased network complexity, more private-cloud deployments, and the advancement of next-generation datacenters are three broad trends behind the demand for this recommended company's core networking solutions, explains Rob DeFrancesco, editor of Smart Tech Investor.
It also helps that security has emerged as a significant growth opportunity. As a result, the turnaround at Infoblox (BLOX) is in full swing.
The provider of network automation and DNS security solutions has been working hard to get its act together after going through a rough period in early 2014 caused by a slow ramp for new security-related deployments.
DNS, a protocol for how computers on the Web and in private networks exchange data, is one of the top attack vectors at the application level. And most network firewalls do not have built-in DNS security functionality.
Infoblox has been successful selling its security products into very large enterprises, as four of the Fortune ten have its offerings.
IT research firm Gartner estimates that DNS firewalls now exist in roughly 20% to 30% of the client deals it reviews, indicating the market is far from saturated.
Once malware gets into a network, the infected code often relies on DNS to communicate with its command-and-control server to extract sensitive data.
Rogue users inside the network can also take advantage of DNS to launch internal distributed denial of service (DDoS) attacks from compromised systems.
In May, Infoblox introduced its Internal DNS Security appliance, which protects the DNS from being exploited by infrastructure attacks, malware, advanced persistent threats (targeted attacks), and stolen data.
The new offering is a nice complement to Infoblox's External DNS Security appliance, which protects against broader threats, such as large-scale DDoS attacks, DNS hijacking, DNS-based exploits, and reconnaissance attacks.
Under new CEO Jesper Andersen, who took over in December, Infoblox is focusing more on companies with 10,000 employees or more.
Meanwhile, some large investors have gotten behind the Infoblox story, adding to positions as the stock rebounded.
In the first quarter, mutual fund giant AllianceBernstein bought 2.23 million shares. During the March quarter, CastleArk (and Lord, Abbett opened new positions of 476,400 shares and 284,727 shares, respectively.
Infoblox shares would be attractive on a pullback into the low-$20s.
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