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Technology Stocks : MAPINFO: Any Thoughts -- Ignore unavailable to you. Want to Upgrade?

To: Charlie Smith who wrote (171)	11/17/1999 9:43:00 AM
From: Alan A. Hicks	Read Replies (3) \| Respond to of 225

It was an excellent quarter! EPS beat expectations by 4 cents in Q4 at $0.28. I think that is about the 8th or 9th quarter in row they have beat expectations. Net Income rose 80% but a higher tax rate held EPS growth to 40% for the year. Management seemed very confident expecting revenue growth to accelerate to 25 to 30% growth next year and operating margins going up to 10%. In particular telecom has been a very strong growth market for MAPS and is about 40% of revenues. At 25% percent growth and 10% margins MAPS should earn $1.07 next year. That is ahead of the analyst expectations I have seen at around $1.02. In 2001 management expected margins to improve to 15%. At a 25% percent growth rate that suggests EPS of about $1.90 in 2001. There seem to be several drivers to MAPS growth: 1.The Oracle8i relationship is pulling in a pipeline of very large orders such as the $2 million Nextel order announced a few months ago. Another large Oracle order this quarter was with Realty One to identify the most promising properties based on demographic data. MAPS should be able to ride the success of Oracle for the next several years. 2.New vertical market applications for the telecom market are adding to growth at very good profit margins. Examples are decibelPlanner to help engineers plan where to place cell phone towers and precisely provide what their RF coverage will be. The company expects at least one vertical market application to be released each quarter for telecom and customer service applications. 3.The recent focus on providing data has been growing at about a 40% rate. This is also repeat business since it needs to be updated on a regular basis. They gave an example of Sprint doing $2 million in business per year with MAPS including software. This recurring revenue base from data sales is now 37% of revenues. 4.Management expects to increase their sales force by 50 to 60% this year to take advantage of all the opportunities. MAPS generated $8.8 million in cash for the year or about $1.40 per share. They bought back 66,500 shares last quarter at an average price of about $20 5/8.