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Building Up a Software Position

This stock has declined for the last five sessions but the company has a lot of momentum and we believe this pullback will be temporary.
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-- Buying 200 shares of Zix (ZIXI) .

Model portfolio name Zix (ZIXI) is trading lower for the fifth straight session today, with the shares currently changing hands around $3.92. We view this weakness as a buying opportunity and will purchase 200 shares after you receive this Alert. This trade gives us a total of 1,700 shares of the company, which account for 3.8% of the model portfolio.

We have seen a lot of weakness in small-cap software names in the past week, especially in the cloud computing names. As a result, Zix has fallen 19% over the past seven sessions, even though management posted solid third-quarter results during that time frame.

The company has a lot of sales momentum and we believe this pullback will likely prove temporary. We maintain our Two rating on the stock and believe it can trade back up toward $5 in the coming months.

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