Paul, thanks for the info on DSO. While other "Caching" stocks like AKAM, CFLO and INKT have been rated by the analysts on the basis of price to revenue, eg AKAM mkt cap of 20+ BN, and last qtr revenues, 1.287 MN, these brilliant types are looking hard at NOVL's DSO.....HUH?
Some clear points to ponder.
1. Do not compete directly with MSFT against Win/2000, Active Directory and Passport. You will be evaluated on the basis of your DSO.
2. Do not gain a reputation as an Internet "infrastructure "
player otherwise the market just might take a liking to
your stock price. Just increase your revenues and make a real profit and quietly move more and more into the new hot areas of the Internet plumbing, ie caching, and the analysts will very thoroughly evaluate your historical DSO
to justify their downgrades while my cynical mind says their firms are quietly accumulating the stock.
Well it is nice to see that you and hopefully Toy have stopped beating the DigitalMe drum.
BTW for Toy; Novell's "core competency" is Netware and all the rest, NDS,ICS, DM, ZEN etc is just recognition that Netware will continue, for the time being, to be the foundation of the company's revenues but not the basis for the future growth. I just happen to believe that ICS could rival NDS for revenue contribution to Novl. At least I don't see MSFT pitching it's caching products.....YET
Below is part of the DSO stuff from Paul's CBS Marketwatch URL; Does Novl really have a long history of increasing DSO to justify any downgrades or analyst concerns?
>>In Novell's case, the company's receivables and inventory add to $308.95 million. And the company's revenue of $344.55 million divided by 90 equals $3.84 million. Take 308.95 divided by 3.84, and it works out to 80.5 -- or nearly 81 days sales outstanding.
Eisenstat warned that the DSO number itself is useless. But it's good to watch the DSO trend over several quarters -- and even over several years. Some companies can develop seasonal DSO patterns. In Novell's case, some analysts said the rising DSO indicated that the company signed many late deals in its quarter, eroding its sales bargaining position.
"Like any figure, everything needs to be put in perspective," Eisenstat said. "But when you see a trend in DSO going up and up every quarter ... that's generally considered a negative." <<
Regards,
Don |
