Amid the recent scramble for Internet and electronic commerce stocks, Transaction Systems Architects Inc. has gone largely ignored.

Analysts expect the Omaha company will play a huge role in the emerging electronic commerce field, yet its share price has languished between $35 and $40 for two years.

The company, with revenues and earnings projected to grow at 25% and 35%, respectively, was trading at $37.625 Friday. That was down $1.50 for the week and 13% from the March 2 high of $43.50. Revenues were $79.3 million in the third quarter, while earnings were $9.2 million.

Analysts said it would be unfair to compare TSA with more exuberantly valued electronic commerce stocks such as, which was trading Friday at $189.9375, despite reporting a third-quarter operating loss of $21 million.

Transaction Systems may not be widely recognized, but it "is a direct beneficiary from all the trends in electronic commerce," said Gregory Gould, an analyst with Goldman Sachs & Co. "These guys don't get a lot of press, but they are a really well-positioned company."

Its core software product-Base24, from its Applied Communications Inc. subsidiary-plays a crucial role in processing credit and debit card and automated teller machine transactions.

Base24 communicates with front-end terminal devices and verifies bank account balances, authorizes withdrawals, and posts transactions. It is used by 500 banks around the world, including ABN Amro, BankAmerica Corp., Chase Manhattan Corp., and Citigroup.

Heather Bellini, an analyst at Lehman Brothers, said 1999 could be the year investors finally understand the "behind-the-scenes" role that Transaction Systems plays in the growing on-line market. "The company hasn't been given credit for the type of business it runs," she said.

Unlike many high-flying Internet stocks, Transaction Systems has fundamental health in key categories such as revenues, earnings, customers, and prospects.

Gary Craft, an analyst at BancBoston Robertson Stephens, said potential "sizzle" in the stock would come from soon-to-be unveiled Internet-based software for banks, called i24.

Transaction Systems is also expanding its smart card business. It is buying Smart Card Integrations Ltd., a London-based technology developer for systems such as Mondex and Visa Cash; and Media Integration BV, a privately held smart card technology company in Gouda, the Netherlands.

Also, last week it announced a deal to buy a Milwaukee-based U.S. Processing Inc., an outsourcing firm that uses Base24 to process ATM transactions for 50 community banks.

Of the nine financial analysts that track the company, Mr. Craft is the most bullish, giving the stock a 12-month price target of $66 a share. Most others, using earnings-based models, project a price of $46. Mr. Craft defends his valuation, saying he used a formula based on revenues.

Of $185 million revenues in backlog-deals not yet recorded on the books- $106 million are recurring revenues, said William Hoelting, vice president of TSA.

Mr. Craft said it has transformed its business model to monthly licensing for its software, which is partly why the stock has languished. Instead of booking revenues from sales up front, the company takes a fee and defers the majority of the revenue.

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