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Technology Stocks : CheckFree Holdings Corp. (CKFR), the next Dell, Intel? -- Ignore unavailable to you. Want to Upgrade?

To: AugustWest who wrote (6323)	6/15/1999 9:47:00 AM
From: Big Al	Read Replies (1) \| Respond to of 20297

I'm flabbergasted that we are not getting trashed. If there was ever any doubt if we were not a true internet company, we know the answer now. The one thing I could not figure out is how they could go on a road show and sell their stock with the company in a freefall.

To: AugustWest who wrote (6323)	6/15/1999 2:57:00 PM
From: Charlie Smith	Read Replies (1) \| Respond to of 20297

August: I took that as a 6 month free trial. Yep. So after 6 months, would the expected new subscribers be "mature"? My guess is yes again. Key is how many new trials does CKFR expect? How many new subscribers do you think will sign up in the next three months to have an impact on FY00 earnings? We can back into CKFR's guess on this number from the .40 loss estimate. Assuming zero new revenue from new subs over the FY00, a swing to a loss of this size from current profit estimates implies a net incremental pre-tax cost increase of $54 million ($32mm - $54mm = $-22mm). If the cost of each new trial is one year's revenue ($48/yr/sub), then they expect 2.25 million new subs ((54/48)2) by the end* of FY00 (1.13mm average for the year). Another way of looking at it is that the new promotional spending will cause every new sub brought on in FY00 to be a pretax loser to CKFR to the tune of $24. Because there will obviously be incremental revenue from the new subs, this $24 number is too high, but IMO it is a decent starting point for determining the profit function for FY00. Charlie