Technology Solutions Company (TSCC) Upcoming Spin-Off Message Board

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Technology Stocks : Technology Solutions Company (TSCC) Upcoming Spin-Off

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To: George Kouris who wrote (12)	12/3/1999 11:30:00 AM
From: NotNeiderhoffer	of 38

GK, The new CFO E-Loyalty hired from CTS a few weeks ago just made a run thru town. I dont have time to post a full blown note but they walked me slowly thru the whole thing and I thought it sounded great. They are going to spend a little more than maybe people thought a few months ago which will hurt earnings a bit in calendar '00 but that should not matter as nobody cares about earnings in this market. E-loyalty will trade under ELOY. They will do a quickie road show in mid to late January to kick off the spinoff. If you look at the comps it would not be totally unreasonable to put a 12-18x revenue multiple on this stock. They are turning in $40 million quarters now and should put up about $190 million next year. Revenue growth will be good but not crazy good, If I am not mistaken I think they are talking sequential growth of 8%-12%. They have a very diversified customer base and best of all have been doing this stuff for several years already and have built a track record. I have not met this Kelly Conway guy but hear he is good. The basic business case is a no-brainer, ie. the compelling case for customer retention. The company is like little Switzerland in the middle of a vast and complex communication network. Some people will beat each others brains out but I think these guys should be golden. Best of all it is not a bodyshop like CATP and others and I would think ultimately we get some serious operating leverage in the numbers down the road. Who needs Kana-I like this one. I certainly dont have my arms completely around this story but I tucked away a little for the long term. The roadshow should clear up some things in a month and a half. NotatradebutaninvestmentformeNeiderhoffer

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