Trying to value shares in Irish e-security firm Baltimore is a thankless task. Few companies inspire such a diverse range of opinions.

The stock is one of the most volatile in the hi-tech sector, but yesterday it held steady at 640.5p.

Some analysts believe Baltimore is on the verge of becoming a global power and a fairer value is around 900p; others rate them an outright sell. Nomura describes Baltimore as "one of the most overpriced software stocks on the market" - even after it fell from March highs of almost £14.

Nomura analysts say last week's deal with Commerce One in the US is indicative of their concerns. Under the deal Baltimore will supply its public key infrastructure to the company but the contract is non-exclusive and Baltimore did not put any monetary value on it.

Nomura argues that Baltimore is valued as if it has proprietary technology and will make high margins. However, the standard it is based on is non-proprietary and Nomura predicts Baltimore will never earn much more than 20%-25% margin.

Current market value of £2bn is 46 times this year's forecast sales and 87 times 2002 forecast earnings. Nomura says this is unrealistic.

What Nomura would like to see is a bigger presence in the US market, arguing that more than half of the world's leading multinationals are based in the US and the big decisions on security will be taken by corporate headquarters. Baltimore's US revenues are growing but mainly through acquisition. Further smart buys would help to calm some analysts' nerves.

Dealing room whispers suggest a possible target is Entrust Technologies, a US rival that last month saw its shares fall more than 50% after warning that second-quarter earnings will be much lower than expected. It is valued at around $1.5bn.

A combination of the two groups would be a very different proposition. Investors should hold, but be prepared for a rollercoaster ride.