Bruce sent me a PM addressing Siebel and many themes addressed recently in the folder. With the idea that others will enjoy BB's stuff as much as I did, I'm posting it with his permission.
--Mike Buckley
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I understand your bewilderment at stocks like Siebel that we have held so long suddenly racing ahead to what, on the surface, seems like euphoric/momentum driven levels. Using the GAP and CAP allowance that the market is extending to Siebel, one really wonders just what the heck the market is doing. We could plug in Oracle and i2 to that as well. What about Commerce One? Wow! I feel that Ariba is the much better company going forward than Commerce One, but the market sure is chasing that one.
I wish I could give more insight on the ARBA/SEBL alliance to you than I did. However, I'm sure you read the posts on the eCommerce thread that were posted many weeks ago about Ariba. It's quite a compelling company and can only add to the benefits of corporations and large businesses that implement strategies to save even more money. Dell announced a huge contract with First Union (which includes B2B) which will save the company 30 percent in costs. I don't know what kind of information is being used in the sales encounters that Siebel participates in exactly. I do know that cost savings and benefits to companies that 'buy' into the sales pitch have customers drooling. I'm now business owner, but if somebody said they could save me thirty percent in costs.....
It is hard for us to imagine how much money is going to be thrown at Siebel (and many others) in an end effort to save money for the customer. I'm sitting here watching the European Markets today and everyone is pushing SAP again over here - despite their disappointing numbers. Siebel is showing no disappointing numbers and really has an upper hand in the market place right now. Our cost basis is much lower than what we are probably thinking at the moment - "Who are the suckers paying over $130 a share?". I bit the bullet and added 150 more shares to my position at a price of $87. I thought I was insane, but I was really thinking ahead. I had most of my family members buy shares of Siebel and i2 over a year ago and told them to just let them sit. Don't worry about them and don't sell them. You can imagine the questions I got when they all dropped earlier this year with Y2K concerns. I think i2 went from 48 to 16. With a slight shake in my voice - I said hold on to them. With even more shake, I jumped into more of i2 to balance it out to match my SEBL holdings. Both may not be flashy, but the telegraphed move to the Internet and B2B growing needs - it caught my attention because of cost savings.
All that being said, I really try to step out and grab the larger picture. What happens when technology affords corporations to save more and more money? We have analysts raising earnings expectations across the board and they are still too low. I think we've entered a powerful phase of the market and Siebel is one of the 'pick and tool' companies that is going to help corporations get even meaner and leaner. That goes for i2 as well.
Nevertheless, I have been chastised by some on the G&K thread for being too diverse in my investments. I could never have 'put everything' in Qualcomm. My wife and I own a ton of Microsoft, and though I went through my shock/anger/acceptance over the weekend - we chose to do nothing. Running the criteria and screens from the Fool, I couldn't reason selling - even though I was prepared for it to drop 40 - 50 percent. The older I get, the more lessons I learn of not panic buying or panic selling. We will probably see a lot of 'panic buying' going forward for a good stretch of time.
I also feel that we will continue to see excellent news out of Siebel. |
