CTXS as the next GMST?
Merlin, BB, and self have been touting the Game on several relevant Fool boards over recent months, and some not-insignificant gamesters have been emerging there amid all the sweet and earnest newbies. I thought the following post, from the Fool's CTXS thread, might be of interest to people here. It goes over ground similar to the "perceptual GG" we discussed a month ago in this space, but with CTXS rather than GMST as the potential gorilla in consideration. But first, so I don't get in too much trouble from Unc, a disclaimer:
WARNING: INVESTING BEFORE FULL TORNADO IS CONFIRMED CAN BE HAZARDOUS TO YOUR HEALTH. PROFESSIONAL DRIVER ON A CLOSED COURSE. DO NOT TRY THIS AT HOME. OBJECTS IN THE REAR VIEW MIRROR ARE CLOSER THAN THEY SEEM.
tekboy/Ares@doesthismakeMerlin,BB,andmeincubators?.com
Subject: Re: Tornado on the Horizon!
Date: 11/6/99 11:45 PM
Author: TinkerShaw
Looking back at Mr. Buckley's April and well timed post about Q, I am beginning to see some similarities between Q, Citrix and GMST and neither involve huge revenue increases.
For example, Q's stock largely lanquished even as the value chain and importance of the Q enabling technology patents were building. The tornado warnings were everywhere. But Q was on the nice sunny side of the storm with the television mistakenly issuing tornado watch messages. None but the very astute pay much attention to such watches. The storm was set off surprisingly and violently by the Ericssen settlement. The storm was never felt in the revenue column. Even today, the revenue column would not give any tornado warning. You would still be stuck with the tornado watch conditions by the daff meteorological agency if revenue was your definitive criteria.
Today Citrix is in a tornado watch - on the sunny side, with dark, nasty clouds visible, moving its way. The value chain is being built - Silverback Cisco is optimizing its product for CTXS, the majority of the nascent ASP industry (which itself may enter a tornado watch of a non-simian variety soon) is building itself around CTXS enabling technology, corporate intranets are moving beyond experiments with the CTXS solution and finding value creation in CTXS enabling technology on par with anything that Ariba or Commerce One, or Siebel, or ITWO can provide in the way of reducing frictional corporate costs. The ingredients are all in place for a big blow.
Unlike Q though, no Ericsson spark exists. I'm speculating, for those who want to buy a Gorilla early (and it is still early) that there is no lower risk time to buy a pre-tornado Gorilla candidate then at this juncture in time. With the tornado watch boldly displayed on the set, and the dark clouds, formed by all the elements above, visible, frightening, and sweeping in swiftly. The storm is visible in the sky. We know the storm is going to hit. But will it produce a twister? This we cannot say. But it is a storm of such nature that we are headed for the cellar in any event - our Q phone in tow to warn the neighbors.
In comparison, I don't think Rambus has reached this point. Rambus is more at a point where a high and low front are forecast to meet at the right time and produce a storm in the next day or two - probably over Rambus, or maybe, but less probably, a bit to the south. Rambus has not reached the juncture at where Citrix stands today because the dark clouds are not yet visible in the Rambus sky. It is just a forecast.
For Gemstar holders, I think the sky looks very similar to the sky seen from Citrix. In addition, however, I think you can see twisters forming in the clouds. The only question with G* is where will the tornado touchdown (as in comparision with CTXS which just has a nasty storm, no funnels yet spotted, but expected). To me the TVGIA merger was the environmental spark that strengthened the already visible storm, and prompted preliminary funnel clouds to form - albeit, not quite touchdown.
In all 4 situations, the one thing in common is that revenue acceleration is not tornadic, but that nevertheless, all the pieces for Tornadoes are in place. Resulting in a death storm with Q; fully formed, yet not touched down tornadoes as with GMST; one nasty storm, with expected but not yet formed funnels with CTXS; and a nasty forecast, but no current storm activity as with RMBS.
The lesson to be gleaned is that those investors, with a little more tolerance for risk, should enter in a Gorilla candidate during the calm before the storm, at the point in which all the necessary preconditions for a tornado have combined (the tornado watch) AND at the point in time that nasty, dark clouds, are spotted on the horizon moving inevitably your way. At a minimum GMST and CTXS are almost guaranteeing one heck of a storm, one which will force you to flee to the cellar just in case, even if no tornado ever touches down. In a RMBS situation, on the other hand (and I'm not telling RMBS investors to do anything, just placing a scale on the Gorilla watch) it may still be premature -it is only a forecast after all. No storm yet visible. No one flees to the cellar on just a forecast.
The analogy works for me. Let me know if it clarifies anything for any others.
Seeking shelter from the storm with my beagle (and maybe wife if she behaves), in my Y2K proofed, heavily armed, and wired for sound bunker, in the hills of Idaho,
Tinker. |
