This is why the Senetas share price jumped 40% in July

Senetas shares are on a tear

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Shares in Senetas Corporation Limited (ASX: SEN) jumped 40% higher in July, spurred on by a mid-month announcement that it expects full year profits of between $5.7 million and $6 million, a 140% lift over the prior year.

Adding to the excitement, an article in The Australian Financial Review named Senetas as one of the seven best ASX tech stocks you've never heard of.

Senetas provides high-speed data encryption hardware to businesses and governments. The hardware sits at the edge of the customer network and protects information transmitted from the private network to the wide area network, or the WAN. In other words, Senetas recognises the need for data to travel securely between sites, rather than simply protecting data while it is at rest.

Senetas share are up 400% over the past year.

Trading at 20 cents, Senetas shares currently trade on a P/E of around 33 times earnings. Even at that premium rating, and even after the stunning past gains in the Senetas share price, if business momentum persists, Senetas shares could still end up being cheap today. I'm in for the ride.

 

Bruce Jackson owns shares of Senetas Corporation Limited.  The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691).

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