From Briefing.com (09/26/00):
BroadVision (BVSN) 29 5/16 -1 11/16: Shares of this eCRM software company are not getting a positive lift from the STRONG BUY recommendation and $60 price target that came out of Wasserstein Perella this morning. Of course, UBS Warburg's BVSN initiation didn't help. Warburg assigned the shares a HOLD rating and a $30 price target citing increased competitive pressures. Wasserstein Perella credits BroadVision's strong competitive position and excellent growth prospects then goes on to assert that BroadVision has been oversold due to market concerns over their product architecture. Indeed, the talk on the Street concerning BVSN has been overwhelmingly negative recently. Two issues have been resounding across the trading floors regarding BroadVision. First was their lack of a J2EE-certified (Java 2 Enterprise Edition) B2B product. According to the Wasserstein Perella note, some industry rivals are calling BroadVision's architecture "proprietary" which usually sounds like a positive on Wall Street, but in this case is a negative because it implies that it limits cross-platform (read: Java) interoperabilty -- remember we're talking B2B here. Wasserstein Perella goes on to explain that BroadVision has always offered multiple architecture standards, including Java, while these finger-pointing rivals are all 100% Java-based. BroadVision will launch their J2EE edition in the first quarter of 2001. The other issue making the rounds is not at all unrelated -- BroadVision has been losing contracts to competitors such as Art Technology Group (ARTG), BEA Software (BEAS), Interwoven (IWOV) and Vignette (VIGN). It is true that BVSN lost a high-profile deal when American Airlines chose to go with seperate vendors for their software (ARTG's Dynamo software and IWOV's enterprise-class content management software) rather than BVSN's complete offering. Interesting that the UBS Warburg analyst has BUY ratings on ARTG and SEBL and a STRONG BUY on VIGN. But remember, BroadVision is one of the leaders in the eCRM space, they are profitable, they are growing their top line at about 275% (based on 6-months through June) and after the giants like Oracle (ORCL) and SEBL, they are the vendor of choice in the growing eCRM market. There is no doubt that the eCRM space is seeing increased competition and the industry may be changing to a more unbundled future, where application servers and content management software will come from a different vendor than your eCRM source, you could argue that one, but either way, BroadVision will be ready. At some point, let's say March, BVSN shares became overvalued. At current levels, the shares are significantly more attractive, but here's the rub: B2B ain't what it used to be. Wall Street loved B2B in 1999, BVSN isn't going to have the kind of stock performance it did in the past, but you can say that about many of last year's NASDAQ highfliers. The newer, smaller (by sales) companies like ARTG and VIGN are growing their top line faster than BVSN, naturally, they are at an earlier stage in the maturation curve. BroadVision's business is solid, and whether you like it or not, the company is now being valued on criteria that weren't much of a factor last year -- fundamentals. - Matt Gould, Briefing.com |
