Tragedy Puts Weapons Detection Companies in the Spotlight (VSYM, ASEI, OSIS)

It's tragic that it takes an event like the one earlier this week at a Nevada middle school to put building security stocks in the spotlight. But, reality is reality. The death of one teacher as well as the student/shooter himself has once again underscored the need for names like View Systems Inc. (OTCBB:VSYM), OSI Systems, Inc. (NASDAQ:OSIS), and American Science & Engineering, Inc. (NASDAQ:ASEI). These three companies make equipment that may have prevented the shooting at the school. As is so often the case, interest in defense-oriented equipment - and a stronger likelihood of buying them - is eventually going to impact stocks like ASEI, OSIS, and VSYM for the better.

Of the three, American Science & Engineering, Inc. is apt to be the best known. It's the company that became the hot button a few years ago following the 9/11 tragedy that spurred airport security to new heights. It's still the "go to" name to meet X-ray and detection needs, even if ASEI struggled a while back with concerns that its backscatter X-ray device took exceedingly "intimate" looks at an individual being scanned.

OSI Systems, Inc. also makes body scanners, though it's not the company's bread-and-butter business. OSIS makes the Rapiscan system, which is aimed at the luggage and freight detection market. Its equipment is good, but it's also priced at institutional levels; airports and ports can afford to pay premium prices for multi-unit systems.

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It's View Systems Inc. that builds body scanners and handheld metal detectors that are just as effective when it comes to finding weapons, but presented in a way that's not foreboding - the VSYM walkthrough scanner looks like little more than a doorway. It's they're also priced and sold more in line with what the typical school system is looking for and can afford.

From and investor's point of view, however, View Systems has something that OSI Systems and American Science & Engineering don't have...it's a young and small company, which means its high-growth phase is still in front of it. Better still, the company is finally getting serious about its publicity effort, which is half the battle for a small cap stock. We've seen more press releases from the company in the past five months than we've seen in the prior couple of years. It's partially a sign that the company is making an effort to keep up interest in its stock, but it's also a sign that View Systems has some activity worth talking about.

Again, it's horrible that it takes horrible news to put these companies in the spotlight. It's equally horrible that these two deaths happened at all. But, an investment in VSYM is in many ways an investment in preventing the next such tragedy. 

For more on View Systems Inc., visit the SCN research page here.