Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Keep Your Eye On The Ball - Watch List -- Ignore unavailable to you. Want to Upgrade?

To: TFF who wrote (1568)	11/16/1999 8:14:00 PM
From: TFF	Respond to of 2802

ECRM mania boosts Quintus on debut By Nicole Koffey NEW YORK. 11:55 AM EST-Given the huge investor appetite for customer relationship management (CRM) software companies, it is no surprise that Fremont, Calif.-based Quintus Corp. (nasdaq: QNTS) got off to a roaring start on Tuesday. The company opened this morning at $42, or 133%, above its offering price. Quintus was priced at $18 a share after increasing its offering amount to 4.5 million shares from 4 million shares. Earlier on Friday, Quintus boosted its offering price band to a $15 to $17 range from $10 to $12. Investors are jumping on a hot deal, but many analysts are puzzling to find real value. In a market dominated by many successful CRM players, this "me too" company doesn't seem to really stand out. Quintus provides eCRM software to manage customer interactions across the Internet and through advanced telephony systems. The company's main product is called the eContact Suite. It essentially enables companies to keep track of massive quantities of customer interactions though a variety of mediums. No one says the industry isn't booming. "Companies have identified strong customer relationship management as a way to differentiate themselves besides cutting prices," says Steve Tuen of IPO Value Monitor. In fact, some even say that because of the explosive growth of the Internet, client responsiveness has become more of a critical survival skill than a mere competitive advantage among e-retailers. "It's become downright embarrassing to companies when they lose track of customers' orders and requests because their Internet service operates independently of their calling center," says Laurie Orlov, senior analyst at Forrester Research. "The result is a need for software that integrates all of a company's resources so that customers don't get frustrated and leave." Although sufficient demand exists for the company's product, not many understand how Quintus plans to stand out from the competition. "The market couldn't be more crowded," says Orlov. She has a point. There are several other companies that provide the exact same service. They include names like Clarify, which was recently bought by Nortel (nyse: NT); Siebel (nasdaq: SEBL); Vantive, which was bought by PeopleSoft (nasdaq: PSFT); Remedy (nasdaq: RMDY); and newcomers like SilkNet Systems (nasdaq: SILK) and Cordiant (nyse: CDA). This suggests that the only reason left to explain the company's 133% pop this morning is that investors view the company as the perfect buyout prospect for someone looking to enter the CRM software market. With so many players dominating the field, Quintus could add client management capabilities to a company that needs it to keep up with the competition. Add to that the recent sky-high prices that customer management companies are going for right now and you begin to see why investors are so excited. In October, Nortel acquired Clarify for $2.1 billion. Another recent deal was PeopleSoft's acquisition of Vantive. Although Vantive went for a much smaller sum (slightly under $500 million) the deal still signals the consolidation occurring in the industry. Considering this appetite, investors simply don't expect a small, attractive company like Quintus to stay single for long. It won't be long before players like SAP (nyse: SAP) or Lucent (nyse: LU) decide they need CRM capabilities and buy a player like Quintus. "Lucent especially would find a company like Quintus very attractive," says Orlov. Investors are looking at [Quintus] as the next desirable takeover target."