PEGA - Pegasystems Message Board

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Technology Stocks : PEGA - Pegasystems

PEGA 58.32

-2.1%

12:53 PM EST

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To: Bill Harmond who wrote (213)	10/30/1997 12:06:00 PM
From: Clam Clam	Read Replies (1) of 504

Cowen says Q2 will need to be restated and Q3 will be substantially different than previous expectations. No value added from Cowen. Maintained their Strong Buy. This is a push out as $50mm from First Data is still guaranteed in the contract over 5 years. But PEGA's valuation was clearly built on upside to the numbers (push-ins), not push-outs. This was just atrocious work by E&Y. PEGA consulted with E&Y on the recognition when negotiating the deal and now E&Y is changing their minds. Then again, PEGA management should have known better than to keep its creative accounting policy when it was going public. I guess that was probably Goldman Sach's fault but Goldman relies regularly on the accounting firms so I guess it comes back to E&Y. Ironic that this stock carried a big premium b/c of its 'visibility.'

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