Omega Research (NASDAQ:OMGA) Message Board

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Technology Stocks : Omega Research (NASDAQ:OMGA)

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To: Pkelly50 who wrote (276)	3/4/1999 10:32:00 AM
From: NotNeiderhoffer	Read Replies (1) of 516

Smitty, There has indeed been a lack of rigorous analysis on this thread regarding the company's earnings prospects. Pulling up some trailing numbers like some of the underwater shorts have is like the proverbial "driving by watching the rear view mirror". What is your understanding of the current user base? From what i can tell the company will admit to having over 50,000 users and possibly quite a few more. I think they are charging $1,800 for these users to upgrade (tradestation to prosuite?) to the new offerings. You can play with your assumptions regarding how many will upgrade and how many new users will come on, along with how many people will bite for the highest-margin ProSuite product. They have also made public the arrangement with Bridge which is a nice deal and the royalties from Bridge will ramp substantially over the next few years, improving earnings visibilty to some extent and also giving the company a shot at posting nice year-over-year comparisons. Trying to model the earnings on this company has given me fits but I certainly think that the forward EPS multiple is fairly reasonable given the earnings potential they have. You are not the only who has heard a $1 EPS number but I don't know if I am buying into that yet. It appears the interface they have with Wall St Access is up and running and the E-Trade interface is either live or will be live soon. I personally am sick of dealing with multiple data and quote vendors and perhaps some of these products would allow me to ditch a few vendors and go with one or more of these products. Maybe HistoryBank.com is the only product that would be of interest though. I am curious to see how they do with the institutional market over the next year as many of these customers are probably less price sensitive than joe main street, and of course the international market is a big opportunity for them as it is currently only 10% of revenue. The company had hired a number of new salespeople over the last few months but I would think there is some execution risk to this story as they try to keep customers happy. Finally, blowing the first EPS number as a public company is sometimes enough to put you in the penalty box forever. It was unfortunate and hopefully they learned from that one. I have not spent much time with these Cruz fellows but they seem like many people on SI, they love to trade and have spent the last 15 or so years building products that appeal to some of the most demanding and well known traders and TA guys in the country such as Schwager and Bollinger. Still sitting this one out... NotgoingbacktothosepitsinChicagoasIhatestandingalldayNeiderhoffer

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