NT Accounting Software (GPSI, PSQL, SOTA, TMBS) Message Board

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Technology Stocks : NT Accounting Software (GPSI, PSQL, SOTA, TMBS)

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To: Jalali who wrote (114)	12/22/1997 4:41:00 PM
From: Alan A. Hicks	of 149

Great Plains blew away the expectations for their second quarter - yet another indication the mid-range financial applications market is very healthy. GPSI has focused on the hottest part of this market - mid-range Microsoft NT applications. On GPSI's conference call CEO Doug Bergum noted that the market is "huge" and there will be multiple winners in this market. Revenues were $20 M up 46% over Q2 last year. Expectations were for $17.7 million. EPS were $0.15 up 129% over last year. Expectations were for $0.13. GPSI reported Thursday afternoon and was up $1 5/8 Friday, even while the Dow had been down 270 points. Burgum views the key to GPSI's growth is in building their VAR channel capacity. GPSI has developed a comprehensive channel strategy to support and develop their channel. These include special training programs, internet based VAR and service support, VAR job postings on the GPSI web site, and a university program that has 100 universities teaching with Great Plains software. GPSI has also generated interest by articulating an aggressive internet and electronic commerce strategy for their applications. Next up in the mid-market financial applications hit parade will be the Q4 report for SOTA and Q2 report for PSQL, both in late January. SOTA VAR's have also been reporting record sales. Expectations are for $20.3 million in revenues and $0.31 per share (up 121%) for SOTA. Still looks like a real horse race between GPSI and SOTA. PSQL VARs have also been reporting strong business. PSQL's recent acquisitions, though, make it difficult to project earnings and revenues. And not to forget TMBS, Jalali says TMBS earnings will be up 100% for 1997. GPSI, at $22 7/8, is valued at 4.7 times trailing 12 month revenues and a PE of 46, not unreasonable for a company growing EPS over 100% year over year. At $16 SOTA is 3 times revenues with a PE of 30, undervalued for a company also posting EPS growth of 100% plus. PSQL is around 3.8 times revenues but is not yet profitable.

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