To All:
May shed some additional information of PSFT and the conference:
Peoplesoft Inc.
Dow Jones Newswires -- October 13, 1998
Peoplesoft Dn 19%; Co. Cancels Talk At A. Brown Conference
By Maria V. Georgianis
NEW YORK (Dow Jones)--Peoplesoft Inc. (PSFT) shares sank 19% Tuesday following the software company's cancellation of a scheduled presentation at the BT Alex. Brown technology conference.
Sources at the firm said the company canceled its presentation after market close Monday. The company was slated to make its presentation Tuesday at 5:30 p.m. EST.
The sources didn't provide a reason for the cancellation.
The company didn't immediately return calls.
Peoplesoft, along with other enterprise resource planning software companies, has been under recent stock pressure due to concerns about the potential for slowing long-term growth. Lower revenue and earnings growth rates in the future are anticipated by Wall Street for several companies, including Peoplesoft, due to global economic issues and to the year 2000 problem diverting technology spending.
The stock is currently down 4 7/16, or 19.2%, at 18 11/16 on Nasdaq volume of 12 million compared with daily average volume of 6.2 million. Earlier, the shares fell to 18 1/2, a new 52-week low, compared with the previous low of 19 3/4 set on Oct. 5. -Maria V. Georgianis; 201-938-5244
Peoplesoft's cancellation of its presentation at the upcoming BT Alex. Brown technology conference damped the performance of other software stocks, analysts said.
"People just have to realize that tech stocks react in an exaggerated direction," said Kash Rangen, an analyst at BancBoston Robertson Stephens.
Rangan noted that shares of J.D. Edwards & Co. (JDEC), SAP AG (SAP) and Documentum Inc. (DCTM) were all off.
Friedman, Billings, Ramsey analyst David Hilal also noted that shares of Documentum's competitor Filenet Corp. (FILE) were down.
Hilal said enterprise software stocks tend to trade in unison, especially when investors are experiencing macroeconomic concerns.
Hilal believes investors are being cautious because they expect companies to begin canceling or postponing software orders because of fears of a rougher economy, especially when the companies may be faced with potentially costly year 2000 remediation issues.
Filenet shares recently were trading at 5 3/8, down 1, or 15.7%, on Nasdaq volume of 2.6 million, which is more than triple its average volume of 781,300 shares.
Shares of Documentum were trading at 21 1/4, down 5 1/8, or 19.4%, on volume of 448,700, compared with average volume of 254,700 shares.
J.D. Edwards shares slipped 10.3% to 30 1/2 intraday on average volume, while SAP shares were down 1% at 35 5/8, also on average volume.
-Maria V. Georgianis; 201-938-5244
-Christina Cheddar contributed to this story.
Reached later, Steve Hill, Peoplesoft vice president of finance and investor relations, said the company decided not to participate in the BT. Alex Brown conference because the meeting fell during the "quiet period" prior to its earnings release, and therefore it wouldn't be able comment on investors' concerns about its enterprise resource planning software growth rates
The conference's format was almost strictly a question-and-answer style, Hill said, and "the questions would have almost entirely focused on the issues we are not prepared to discuss today."
Since the beginning of October, Peoplesoft's shares have lost 42% of their value as several analysts lowered their ratings on anticipation of slowing revenue and profit growth.
The anxiousness over ERP software stocks has also been heightened by Baan Co.'s (BAANF) Monday preannouncement of a potential third-quarter loss between 13 cents to 16 cents per American depository receipt. Wall Street had been expected 15 cents a share.
"We continue to evaluate many of the concerns raised in early October by certain analysts concerning the ERP industry and currently anticipate being in a position to provide Peoplesoft's perspective on Tuesday, Oct. 20," Hill said.
Peoplesoft is to report third-quarter earnings next Tuesday after the market's close.
The company decided to pull out of the conference last Friday but wasn't able to reach BT.Alex Brown software analyst Jim Moore until Monday afternoon to inform him of its decision, Hill said.
Peoplesoft knew in advance that it's conference participation was slated during its quiet period, Hill said.
- By Maria V. Georgianis; 201-938-5244
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