Saville Systems (SAVLY) Message Board

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Technology Stocks : Saville Systems (SAVLY)

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To: New2Tech who wrote (134)	7/29/1998 1:20:00 PM
From: Leeza Rodriguez	Read Replies (1) of 261

This company got it's head chopped off because it was trading at a high PSR (price to sales ratio) and announced flat forward revenue growth. The higher the PSR, the harder they fall when revenues go flat. I have been charting the relationship of stock price movement relative to PSR and net margins for a couple of years . With best case net margins of 25%, I would not be surprised to see this stock trade down to a PSR=6, or $20 a share. This is a great company in a great niche. The ability to granulate billing is critical. If you can't bill it, the service ain't worth squat. However, with high PSR stocks there is simply NO tolerance for flat sales growth. This is a great buy at $20. Leeza Rodriguez

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