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Two analyst and top management from eight sector firms examine the security products & services sector in this special 38-page Security Products & Services issue from The Wall Street Transcript, available at (212/952-7433) or http://www.twst.com/info/info516.htm.

TWST: Following September 11, how have the security stocks performed?

Mr. Kessler: The security stocks initially responded with uncommon zeal. Wall Street's old view of security was that of a group of companies involved in a necessary but negative sell, an industry of service companies with steadily growing cash flows, but not something that was necessarily demanded by corporate clients. Following September 11 that has changed. We won’t predict how permanent that change is. But from Wall Street’s point of view, the stocks of most companies reacted dramatically. While it is hard to pinpoint the long-term opportunity, it is clear that homeland security and consulting as well as protecting corporations and national interests abroad are going to require a heightened use of security provided by a select number of these public companies.

TWST: What are your favorite names in the group?

Mr. Kessler: Even though it stretches the definition of security a little bit, we like Symbol Technologies (NYSE:SBL) for the long haul. One special situation is Pittston (NYSE:PZB). Pittston continues to own two of the most attractive security properties in the world today. The first is Brink’s Armored, the leading armored transport company in the world, and the only company with major operations all over the world. And the second is Brink’s Home Security, which, as I mentioned earlier, is the leading remaining mass-market residential and small business alarm monitoring company that hasn’t been bought by either Tyco, a European company, or a utility. Unfortunately, with Pittston we have to wait until the disposition of some coal-related liabilities is completed to realize the value of these two world-class properties, but we believe that that value is worth waiting for.

TWST: Are there any characteristics investors should steer clear of in the group today?

Mr. Kessler: There are a couple of things that have historically been problems in the security industry and there are a couple of things that people should watch out for specific to post-September 11th events. Historically we have tended to get too excited over the newest, whiz-bang security product as the solution to complicated problems, whether it was the inauguration on a mass-market basis of RFID, the introduction of digital video, or the introduction of cheap fingerprint readers. Being able to provide a broad-based solution and being able to provide a recurring revenue and cash flow stream from these broader-based solutions is what investors should be looking for, not some type of hot product. In the early 1990s I remember a tiny camera called TVX being introduced to the world through a company we used to cover, the largest alarm company in the UK, Automated Security Holdings (ASH). We believed then as we do now that tiny digital video is going to be in high demand throughout the world, and it is just coming into its own now. However, ASH spent a lot of money and lost a lot of money on an individual product that took many more years than we ever expected to become part of a larger solution. ASH was eventually acquired by ADT. We learned our lesson from that, and that is one of the lessons I want to give to investors today.

This special issue includes:

1) Outlook for Security Stocks - In an in-depth (4,000 words) Analyst Interview, Jeffrey T. Kessler, Senior Vice President at Lehman Brothers, examines the outlook for the sector including and shares specific stock recommendations.

2) Security Products & Services - In an in-depth (2,600 words) Analyst Interview, Peter J. Barry, Managing Director for Small Companies at Bear, Stearns & Company, examines the outlook for the sector including and shares specific stock recommendations.

3) CEO interviews (average 2,500 words). Top management of eight sector firms examine the outlook for their firm and the sector.