Elliot,
Yeah, I've been hearing the "CA" stuff for three years, and I don't see it. A friend of mine in Texas that works at USAA, a HUGE company with a HUGE data center, turned me on to New D in 1994. He used to voice fears about CA stepping up and squashing New D, even though he was on a technical eval team that chose New D over CA and others (I think to replace CA products as well). The resounding cry was that CA's products are just not as good, and their support is awful. The story is that they buy up companies, rape the product line and layoff people, and don't keep up with advancing technology. Hence, CA gets those VERY LOW scores from the Gartner Group for their "future vision". CA's big benefit in the past was, as Gartner put it, their "ability to deliver". Well New D's ability to deliver has jumped in the last few years, and their future vision tends to be far above their peers. That friend of mine jumped out of New D about a year and a half ago around $7, as the stock was topping, and he feared the then coming release of the new CA-Unicenter. Well I'm happy to report that he jumped back in last fall at $19, and no longer has the big fear from CA that he once had. He even told me recently that he no longer views CA as a threat, as New D really is putting out better products and are becoming recognized. That comes from a systems guy, and not from a broker or an everyday investor like myself. Besides, New D has really expanded beyond their reliance on Control-M and Control-O, and the mainframe market that had once held the vast majority of their product sales. New D's "plug-in" IOA architecture sounds very, very impressive, and hopefully will catch on. It makes sense. I have watched people in my organization try to hammer in major changes and upgrades into our systems over the years, and it seems that an integrated approach would have tremendous advantages over the software they now use. New D's products are tight. That is a very key consideration.
I cannot stress enough how KEY the DISA sale was. (NOTE for those reading this not familiar with "DISA", New D won the contract to furnish a major chunk of the systems software for all of the Defense Information Systems Agency's mega centers last spring. In the process they beat out IBM, CA, Platinum, etc. In fact, New D's software was selected to REPLACE some CA software, who already had been entrenched at the sites.) We are not talking about some dinky little company, but but an agency who's core systems deal with issues related to our National defense. I doubt the decision to buy software from a company outside US borders, and in a sometimes troubled area in the Middle East, came lightly at the Pentagon. To me, that speaks VOLUMES about the quality of New D's products and services.
As for Hollander, I do not know. Supposedly it takes an agreement between Hollander, Roni, and Dalia to sell their stock in mass. Individually, they each used to be limited to 1-3% (forget the exact figure) per year, unless they sold the company in mass. But that "Founders Agreement" may have expired by now. Personally, I'd rather see the stock move higher for another year or two, THEN be taken out by IBM (who has crappy systems software, or so my sources tell me), or CA, or Boole and Babbage (a rumored suitor in the past), etc. I'd like a buyer to have to pay $50-60 a year or two down the road, and not $30-35 today. Anyway, that is on my wish list. But it does make sense for them to be bought out someday, as their technology is supposedly that damn good that it ought to be a hit for any acquiring company. A bigger company with a big marketing arm and scores of customers could really get New D's software out in the marketplace with greater penetration, and then the maintenance revenues would stream in for them. And, as I have heard, the maintenance requirements when using New D's products are minimal, as the software all works well. Thus more of the maintenance revenues drop straight to the bottom line.
Anyway, as always all this is just my opinion. Later.
Mike |
