• Our panelists give you the scoop on all the inside business information before you hear it anywhere else in The Informer segment:

    David Asman: This week's Informers are Elizabeth MacDonald, senior editor; Chana Schoenberger, staff writer; Mike Ozanian, senior editor and Victoria Murphy, staff writer. Victoria, let's start with you: Internet security, it used to be a big deal. Is it still a big deal?

    Victoria Murphy, staff writer: I don't think it is.  A report coming out Monday shows that spending on Internet security is actually half of what analysts have been saying.  I think stocks like Symantec (SYMC), Check Point (CHKP) and Network Associates (NET) stand the most to lose because they specialize in firewalls and anti-virus software. 

    David Asman: So, you're saying you don't want to buy these stocks.

    Victoria Murphy: No, I think they are the ones that are most at risk because what they sell is what most buyers have already bought and probably won't be buying again. 

    David Asman: Chana, what do you think?

    Chana Schoenberger, staff writer: Well, I've actually seen figures saying that the threat from Internet security is growing, that hackers are getting more devious.  There are more blended threats.  The new viruses are available online for other hackers to take, almost as soon as they get hacked.  This is kind of scary.

    Victoria Murphy:  Well, Chana can believe the hype.  The buyers of about 164 companies were interviewed in this report.  It says that half of them were cutting back their spending on security, which hasn't been said before. 

    David Asman:  Elizabeth MacDonald, the X factor, what's that?

    Elizabeth MacDonald, senior editor:  That's Xerox (XRX).  I see this stock is making a comeback, surprisingly off its October low of $4.

    David Asman:  But, it's doubled since October.

    Elizabeth MacDonald:  Yeah, it's trading at $9.  Here's why.  Stock Diagnostics is this great research firm in Boca Raton.  They've been watching their trailing free cash results and they're coming in really strong at 1.7 billion, so I think that Xerox might be a stock you want to watch.  And we know they came off this terrible accounting scandal, but they've cleaned out their problems.

    David Asman:  Victoria, what do you think about Xerox?

    Victoria Murphy:  I think investors should look at this as a short-term play.  If you look at the history of Xerox stock price, going back thirty years.  If you invested $10,000 thirty years ago, it would come out to $3,200 now.  And if you invested $10,000 ten years ago, it comes to $6,000.  This isn't adjusted inflation.  So, if you adjust for inflation, it's even worse.  Long-term performance hasn't been good, but this could be a short-term play.

    David Asman:  Woulda, shoulda, coulda.  What do you think about this Elizabeth?

    Elizabeth MacDonald:  I can't dispute the numbers, but I'm always for rebound stocks and stocks that have come off these horrible situations where they have a new board.

    David Asman:  We'll talk about horrible situations.  You should have seen my student loan portfolio.  Chana, you say that banks can actually make money off of student loans.  How?

    Chana Schoenberger:  They're already making a tremendous amount of money off of student loans and you'd know this if you were paying them.  Citibank (C) just announced a big program with Harvard University.  They are going to be offering student loans to every one of Harvard's 12,000 grad students. Now what's unusual about this is that Citibank already does some $900 million in student loans.  They're going to be sharing the risk with Harvard, which means that for all those grad students who don't have that good of credit or are international students who can't get credit here, Harvard is going to say they don't care, they want Citibank to give them a loan and they will back it up.

    David Asman:  Good for Harvard, good for students and good for the banks. 

    Chana Schoenberger:  That's right.