Coch: Shortly after RHAT's IPO, I thought their share price would land at $35 after a couple of months. Several splits and follow-on offerings later, $35 is now in sight.
A shift in the Linux realm will result in CORL hitting the $100 mark. It will take a little time, but not too long. After all the shuffling now occurring in the markets, investors are going to want companies that generate substantial revenue and earnings.
Redhat has a small "packaged" revenue stream, relying heavily on service. How long will it take RHAT to rack up several hundred million in revenue based on service without proprietary products to sell? Answer: Longer than Wall Street is willing to wait.
LNUX derives revs from hardware and service. T'aint much profit in hardware these days. Service revs will accompany hardware deployments, but how long will Wall Street wait for several hundred million in revs, let alone profits?
CALD, they're looking for embedded systems revenue. It'll happen, but not overnight. Besides, they'll be competing with RHAT in that arena. How long will it take to create substantive revenue? Kind'a lucky their IPO was not overdone. But still, with a billion in market cap on a few million in revs, how long will Wall Street wait?
When the TurboLinux and LinuxCare IPO's occur, they'll further dilute investment dollars for linux firms in the "unknown quantity" realm.
Now piddly ol' Corel, revs of $200 M to $240 M, give or take a little. Despite Q1, they did produce a profit last year. Now, launching the only world class productivity suite for Linux, not to mention Draw and Photopaint coming down the pike, things are looking Up. I think we'll see increased demand for Corel linux as the Suite is released.
Add to all this ongoing windows offerings and the merger with INPR, CORL is picking Up real strength. The prospect for strong revenue growth is a better bet than any other Linux player. Cowpland's played his cards right on this one.
A good dose of "realism" is settling in on Wall Street. Facts are that the trend of more-and-more investment dollars pouring into firms with flimsy revenues, will not "be there" to support the atmospheric valuations accompanying the era now dubbed "the new economy." Money managers still must produce "old economy" returns, or they're out.
It's getting interesting . . .
Scott |
