An interesting article FYI:
(UPDATE) Sanchez Shares Jump On Plans For IPO Of e-PROFILE Unit
Dow Jones Online News, Wednesday, April 21, 1999 at 18:37
By Dinah Wisenberg Brin, Staff Reporter
MALVERN, Pa. -(Dow Jones)- Sanchez Computer Associates Inc. shares, which surged 150% one day last week, took another swing higher Wednesday after the banking-software developer announced plans for an initial public offering of the subsidiary that contributed to last week's big run-up.
Within the next 12 months, the company plans an IPO of e-PROFILE.com, a new outsourcing business that will allow companies to open their own Internet banks with relative ease and little upfront cash, Chairman Michael Sanchez told Dow Jones Wednesday. He said Sanchez Computer plans to announce e-PROFILE.com's management next week, its first technology partner in the next two weeks and top-tier customers in the next 30 to 90 days. Taking the same wild ride as other Internet banking shares, Sanchez stock (SCAI) soared 150% to $79.875 from $31.875 on April 13, then slid about 34% by Monday, when it closed at $52.563. The stock closed Wednesday at $61.125, up $10.625, or 21%, on volume of 369,000 shares, compared with a daily average of 215,700. E-PROFILE.com, which the company is launching through its purchase of ArTech Financial Services of suburban Pittsburgh, should be up and running early next month, he said. Sanchez Computer is building a new data center outside Pittsburgh that will allow e-PROFILE, which has some existing customers, to support large institutions.
"We are working with some clients who have yet to disclose their plans ... large-brand players," Sanchez said. The possible partners include Integrion Financial Network, Edify Corp. (EDFY), CheckFree Holdings Corp. (CKFR), Compaq Computer Corp. (CPQ), Home Financial Network Inc., International Business Machines (IBM), a Federal Home Loan Bank, Hewlett-Packard Co. (HWP), Pricewaterhouse Coopers and Securities First Technologies Corp. (SONE).
Sanchez Computer, which went public in January 1997, is itself a spinoff of Safeguard Scientifics Inc. (SFE), the nearby developer of entrepreneurial-technology companies. As of Dec. 31, Safeguard owned nearly 27% of Sanchez shares.
First-quarter earnings results are due Thursday, and Sanchez said he is comfortable with the mean analyst earnings estimate of two cents a share. The company earned seven cents a share in the year-ago period. He attributed the expected decline to a recent change in the company's pricing, which trades upfront customer payments for bigger long-term revenue.
Sanchez also backed analysts' full-year earnings forecast of 64 cents a share, which would be an increase from the 57 cents a share reported for 1998.
"We've beat expectations for the last nine quarters since we've been a public company," he said.
Copyright (c) 1999 Dow Jones & Company, Inc.
All Rights Reserved.
Companies or Securities discussed in this article:
Symbol
Name
NASDAQ:CKFR Checkfree Holdings
NYSE:CPQ Compaq Computer
NASDAQ:EDFY Edify Corp
NASDAQ:HWP Hewlett-Packard
NYSE:IBM Intl Business Machines
NASDAQ:SCAI Sanchez Computer Assoc
NYSE:SFE Safeguard Scientifics
NASDAQ:SONE |
