What made me decide to get in was this piece:
department.stthomas.edu
Basically my feeling is that this stock is reasonably valued at the current time; as you know I have been waiting patiently for a chance to buy the stock under $10. I thought they IPOd the company early, as I told you long ago. Of course in this market they really couldn't have done an IPO, but if they could have waited until next fall I think they would be a lot better off.
In evaluating the competition I noted that many have not yet IPOd, so there is a distinct possibility that as the IPO market warms back up some of VIAD's competitors will IPO, such as Plumtree. That will bring the attention back to VIAD, and there is a non-zero chance that this could become a bubble stock this fall.
The thing I have trouble evaluating is that non-direct competition. The basic concept of a portal is that it is a way of sharing information. There are other approaches to the same problem, though. See OTEX, TIBX, MCTR, and BVSN. Also even within the portal market there are database portals from IBM, Oracle, IFMX, and SYBS, among others, and Business Intelligence portals from the likes of ACTU, BRIO, COGN, BOBJ, and HUMC. Thus an an outsider it is almost impossible for me to foresee how this market will ultimately shake out. I have no doubt though that for awhile all the competitors will grow.
Thus for me, there are four distinct possibilities:
1. The stock could become a bubble stock and go to 100+
2. If the stock doesn't become a bubble the return should be reasonable and match the sales growth rate (i.e. 100%) since the stock is reasonably valued based on the current sales.
3. A larger software company could buy them.
4. One of the other approaches to information sharing could become the accepted solution, in which case the stock falls significantly.
Thus 3 of the 4 alternatives are favorable, so I thought I'd give it a try. I should add that I also have stakes in BRIO and ACTU, two of the BI Portal companies.
Carl |
