(FORTUNE Magazine) – With the pillars of the new economy crumbling around us, it's difficult to remember what we were all so excited about back in the late 1990s. But if investors can manage to see through the dust--and purge themselves of emotion--they'll realize that the Internet is not only still standing but actually growing. Roughly half of the U.S. population (138 million users) will be online by year-end, up from 104 million in 1999. And for all the dot-com deadbeats, the Internet really has changed the nature of modern commerce. Jupiter Media Metrix estimates consumers will spend $34 billion online this year, up 42% from 2000.

Amid the relentless swirl of formation and destruction that we've come to know all too well, the sector is creating its own elite--a set of companies that will survive the shocks of today and go on to dominate the landscape of tomorrow. To find these future blue chips, we zeroed in on companies that are market leaders and standard setters. These are the stocks that will rise from the rubble.

Security

Crime pays--or at least fighting it does, especially for Internet Security Systems (ISSX, $47) of Atlanta. There's no question about the need for its services: The FBI estimates that 85% of U.S. companies experienced at least one network breach last year. Those break-ins cost companies roughly $10 billion in damaged systems and lost information. With 8,000 customers worldwide--including many major telecom carriers and 21 of the top 25 commercial banks--ISS has a staggering 54% of the market for network security systems, a market that Todd Raker, an analyst with Credit Suisse First Boston, says could grow to $30 billion by 2004. Raker estimates the company will earn about $206 million this year, a 53% jump from 2000. Trading at 78 times estimated 2001 earnings, it's not a cheap stock, but Raker calls it "one of the best-positioned companies in the sector." And he says that as ISS expands into new areas, like wireless network protection, its thick 69% profit margins should grow even fatter. ISS is even getting a lift from the slowing economy, as businesses cut staff and outsource data management. In fact, one in five of ISS's new customers this year claims it's hiring the company to help counter network sabotage from laid-off workers.

E-commerce

In the six years since its inception, eBay has gone from an auction site for Pez dispensers to a "fixed price" storefront, selling everything from Cisco routers to BMWs, and turning a profit all the while. The more expensive the item, the better for eBay; it takes a cut from every sale on the site. Since the company (EBAY, $70) has few fixed costs--no inventory, no sales force, and no warehouses--its margins were a stellar 82% during the first quarter of 2001. Company executives boast they can increase revenues 50% annually, to $3 billion by 2005. Some investors actually believe them and think eBay is worth buying, even at its lofty levels. "Granted, the stock is rich right now," admits Mitch Rubin, manager of the Baron Funds' iOpportunity fund. "But there was $8 billion worth of economic activity on the site last year. If you buy it now, I still think you can make a great return."

Infrastructure

Remember all the pre-bubble hoopla about investing in companies that sell "picks and shovels at the gold mine"? Well, the luster is fading from equipment companies like Cisco and Juniper, but the gold mine itself still gleams--and VeriSign (VRSN, $59) owns a big swath. After its acquisition of Network Solutions last year, VeriSign is now the sole source of Internet addresses in the highly populated ".com" domain. (About 80% of the world's addresses end in the suffix.) Under a deal with the U.S. government, VeriSign retails domain names for $35 a year and wholesales them to competing retailers for $6. True, some major market players, like famed short-seller Manuel Asensio, are betting VeriSign stock is headed for a fall, convinced that the government will eventually strip the company of its monopoly. But under the current contract it has a lock on the .com business until at least 2007. And although domain registration growth is expected to slow this year, renewals are becoming a large part of VeriSign's activities. This year some 17.1 million names will need to be reregistered (at $35 a pop), up from 3.1 million in 2000.

Lately the company's status as cyber real estate tycoon is overshadowing the business that gave the company its name and still generates about half of its income: It verifies online identities--crucial for any company attempting e-commerce. These authentication systems are used by almost all major commercial sites on the Web.

VeriSign stock is no bargain, trading for 94 times earnings, but with a virtual monopoly on two important parts of the Web, it's an essential part of any Internet portfolio. "VeriSign is the Internet infrastructure," says Dan Chung, co-manager of the Enterprise Internet fund.

Financial services

The Web was supposed to cut out the middleman. Somehow it overlooked Actrade Financial Technologies (ACRT, $23), which greases the wheels of the once ballyhooed (and now booed) B2B market. Companies bought and sold some $336 billion online last year. Actrade helped them do it by providing online credit, payment, and settlement systems for big-ticket transactions. One of Actrade's most popular services: financing receivables. It has always been tough for small and midsized companies to sell to bigger players, in part because large corporations tend to pay for purchases on their cycles--not on the seller's. Actrade's financing system makes both parties happy by paying the seller immediately--minus a small percentage. Revenues are rocketing--up 93%, to $31.6 million, last year--and the company turns a slight profit. Steven Tuen, manager of the Kinetics Emerging Growth fund, says Actrade's potential is huge: "It's a great example of a company that's growing and is still a bargain." At $25, it trades for about 14 times this year's projected earnings.

Software

Think of Openwave Systems (OPWV, $31) as a Netscape for the wireless age. The Redwood City, Calif., company is the leading provider of software and server hardware that allows wireless devices like PDAs and cell phones to retrieve information from the Internet. Roughly 97% of Net-ready cell phones in the U.S. and three-quarters of those overseas are equipped with an Openwave browser. And according to the Art Technology Group, a Cambridge, Mass., market research firm, messaging--not phone calls--will become the dominant application among wireless users within a few years. All of this bodes well for Openwave, which has been profitable since the second quarter of 2000. The massive slowdown in telecom industry spending has hit the company's stock, but not its sales. CFO Alan Black is sticking by revenue projections of $640 million for the year, more than twice last year's amount. That makes the shares, trading at half their January level, look attractive. "The next generation of cell phones are all Internet-enabled, and Openwave will be the dominant software on those devices," says the Enterprise Internet fund's Chung. "They're going to be huge."

Storage

The sheer volume of electronic data that is being created today--from audio recordings to digital video movies--can be overwhelming. Storage company EMC (EMC, $27) helps companies manage the morass. The tech slowdown has smacked EMC, forcing its executives to retool their ambitious $12 billion revenue goal for the year. Even so, the company says that it will use the downturn to grab market share from competitors like Brocade and Veritas. No question, the stock--down about 62% since January--may still be volatile in the near term. But, says Lehman Brothers analyst George Elling, "once information technology spending resumes, EMC will be among the stocks likely to rebound nicely." Just like our other survivors.