Wind River is a bargain compared to AOL.
So, I bought some AOL puts last week, but otherwise I have no bets against any stock. Why can't you accept the fact that I'm simply providing an badly needed alternative viewpoint? Are you under the delusion that the Internet can somehow affect the stock price? Most technology stock investors don't use the Internet!
I really have no idea where the stock price is headed. I agree with Pirah Naman that stocks can be mispriced for years before reaching a fair price, although I think the market is becoming more efficient and a stock is unlikely to remain mispriced more than 2 years. Netscape was overpriced for about 2 years before it finally crashed. Netcom and other stocks hyped by investment banks crashed a lot sooner. AOL, Viasoft, and Wind River remained overpriced. Most stocks hyped by investment banks underwriting IPOs and secondary offerings are overpriced and have a lower price 12 months after the offering. Wind River is one of the less overpriced stocks in the group, as any of the SystemSoft investors on this thread can attest.
I would've thought you'd be flattered that I quoted you so often as an authoritative source. If you were an academic and nobody cited your work, your career would go nowhere. Nobody else cited your post, so it's only a slight exaggeration to label me your savior! Others admitted they didn't understand it, so my clarifications were useful to them, if not to you. If you didn't intend to educate and provoke discussion, why did you publish the post?
Despite the high quality of your valuation post 1068, I think you misunderstand the significance of the Soft-ATM deal in your recent post. The only people that can use it are developers of ATM systems (not their customers), which is a very limited market. This is what Pauline Schumann in EE Times and Wind River in their press releases mean in the passage below, unless you subscribe to the Lehenky EE Times Conspiracy Theory:
Wind River Systems, Inc. (NASDAQ:WIND) is the leading provider of integrated software development tools for real-time embedded applications...
ATM uses fixed size (53 bytes) packets called "cells", in contrast to the variable sized IP packets. So, it's very efficient and fast to implement ATM in dedicated hardware. ATM implemented in software would be very slow for a backbone, even with the fastest general purpose processor. It would avoid collisions inherent with Ethernet and so could conceivably be useful on the desktop, but Ethernet is well-entrenched there. For details of a typical configuration at aircraft developer Gulfstream, see biz.yahoo.com. Soft-ATM is simply an attempt to make life easier for developers, as the very first sentence of the press release indicates:
Using Wind River Systems' Tornado Interactive Development Environment and Soft-ATM, can save months in the development of new ATM products
Fore and Cisco already have mature proprietary development systems, but Soft-ATM/Tornado might find a market niche among smaller developers. You're right that the ATM industry is experiencing tremendous growth. Fore has a P/E of 13 after subtracting out book value, which makes it a much better deal than Wind River. I think it's a steal and I own shares. |
