>>>>The CD did not ship until Nov 15. If companies are given a 60 day trial, then any CD revenue will not show up until the third quarter. <<<
I don't think this is a valid analysis. Why wait the full 60 days. They can use the CD for free to inventory their systems. That's all. Then what? If they decide they may have a problem and need the database to check for compliance why the heck would they wait the full 60 days. They can't use the database until they pay.
Also although the CD didn't ship until Nov. 15, there was considerable build up before that.
In July Tpro sent out a 5,000 mailer to it's customer base alerting them to the planty2k-one product. In September Hagewood claimed they were getting dozens of calls a day from people asking for help.
In November Jenkins said Wonderware was getting one call an hour about year 2k work and that was being referred to Tpro.
Also in November Jenkins said he had 3500 sites on his list as potential prospects.
Now if there had been a demand or need for this product don't you think there would have been a least a small backlog among all those people who wanted the product as soon as it became available.
And it wouldn't take much of a backlog to make an impact on revenues in the 2nd qtr.
If only 200 CD's were ordered at $4,000 per then Tpro should have increased their revenue by $800,000. If you use the $20,000 estimate that Jenkins gave as an average that would be $4 million.
Yet Tpro is predicting only 1 to 1.5 million in yr 2k revenue in the 2nd qtr and if you read the conference call and take into account the news that revenues will be flat qtr. to qtr, it seems obvious to me that most of that revenue is service revenue.
My own opinion is that CD sales are not going that well so far.
On the other hand if you look at the numbers I gave it seems clear to me that Tpro won't need to sell that many to make an impact.
Presumably the product will get better and better with time.
Also as 2000 draws near more and more of the laggards may be panicked into buying.
Maybe there are other explanations for this.
I can think of one but I'll keep it to myself.
But for right now, whatever others think, I am skeptical as to how well the CD is doing.
One last point. Something I read a couple of years ago on the Iomega thread on AOL has stuck with me.
That was one persons opinion that the single most important factor for determining stock price was growing earnings.
Not fundamentals, not pe, not balance sheet but growing earnings.
Now I think it highly likely, although I continually reevaluate this, that Tpro is going to show constant earnings improvements over the next few quarters and if they do so then the stock will do fine regardless of all these other issues.
That plus continued optimistic forecasts for the future.
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