Websense (NASDAQ:WBSN) provides employee management products that enable organizations to analyze, report and manage how their employees use computing resources, including Internet access, instant messaging, peer-to-peer file sharing, network bandwidth and desktop applications. The firm's primary product offering is the Websense Enterprise software application, its central policy engine and management console. Websense Enterprise also serves as a platform for related Websense add-on modules such as Client Application Manager, Bandwidth Optimizer, instant message Attachment Manager and Client Policy Manager, and supports a variety of reporting options that allow organizations to document patterns of employees' use of computing resources.
The MCM staff looked long and hard for a new "bullish" position today, primarily to replace the Goldman Sachs (NYSE:GS) play that soared out of reach during Monday's rally. Despite our best efforts, the near-term market activity left us with relatively unfavorable entry points in all but a handful of issues and most of those have crucial earnings reports due in the coming weeks. With that fact in mind, we decided to focus instead on a short-term position with slightly more risk (and profit potential) than we can accept in the MCM portfolio. The company has already posted outstanding revenues in the current quarter and their customer base is growing as its products become integral to enterprise security. Traders who achieve the target ($0.35) credit will earn a monthly return of nearly 15% if the position is successful, however it will not be included in the summary.
PLAY (less conservative - bullish/credit spread):
BUY PUT FEB-45.00 DHQ-NI OI=1798 ASK=$0.25
SELL PUT FEB-50.00 DHQ-NJ OI=779 BID=$0.55
POTENTIAL PROFIT (X 5 contracts) = $175