To: Kimberly Lee who wrote (43823 ) 12/13/1999 12:55:00 PM From: Tassi Read Replies (2) | Respond to of 108040
13 Dec 8:55 By Marcelo Prince NEW YORK (Dow Jones)--Hot on the heels of VA Linux Systems Inc.'s (LNUX)eye-popping initial offering, several little-known stocks enjoyed hefty ralliesin Friday's session as investors trolled for the next Linux highflier. The better-known Linux names, including RedHat Inc. (RHAT), Corel Corp.(CORL), Andover.net Inc. (ANDN) and Cobalt Networks Inc. (COBT), lost some steamFriday and posted modest losses between 5% and 13%. Rather, frenzied investors apparently moved on to "undiscovered" darlings andscooped up shares of companies that seemed to be hopping on the Linux bandwagon. "Basically (people are) trading on psychology and greed right now," said BrianBelski, chief investment officer at George K. Baum & Co., of the Linux-relatedstocks' surging. "I think it's a fad that will pass," said Bill Meehan, market strategist atCantor Fitzgerald. "Some people will make money providing services and buildingout systems," but nobody is going to become the next Microsoft Corp. (MSFT) since the source code is free. That's fine with Eric Raymond, a prominent Linux supporter and director at VALinux, who said the goal of the Open Source software movement from which Linuxhas sprung is to end proprietary software and secretive source codes, notnecessarily promote Linux. "Is the interest in Linux per se sustainable? I don't know," Raymond said. "Ata certain level I don't care. The important thing is to solve the softwareproblem." Accordingly, he said he's not bothered by the increasing number of companiesthat are using the Linux name when it suits them. In fact, he sees them asnecessary: "If we want victory and allies, we have to welcome the Johnny-come-latelys," he said. Well, there were plenty of those Friday. Take Bitwise Design Systems Inc. (BTWS), which ended up 37% at 14 3/8, after reaching a 52-week high of 22 3/4 earlier. The news? BitWise issued a press release Thursday letting people know that its softwarecould work on a Linux platform and it had a test version of a software tool kit(i.e. instructions) for Linux programmers. BitWise's document-authentication software, AuthentiDate.com, has alwayssupported various platforms including Linux, Chief Executive John Botti told DowJones Newswires. The company just wanted to make sure everyone knew that. "We had this developed for a long time," Botti said, "We just waited for atime when we would get a lot of attention for the product. And we got a lot morethan we expected." Micros-To-Mainframes Inc. (MTMC) was another big winner, climbing 33% Friday after it said it would provide monitoring services to companies that run a Linux operating system. Never mind that Chief Executive Steven Rothman said it doesn't yet have any Linux customers, the stock was up 33% Friday. Another star was Wave Technologies International Inc. (WAVT), which finishedFriday up 37% at 6 after setting a 52-week high of 12 1/2. It issued a pressrelease touting itself as "one of the leading providers of Linux technicaltraining." What was new? Well, a tremendous amount of "activity in the marketplace" spurred it to"expand its Linux training initiatives over the last six months," the releasesaid. Makes one wonder how long they were holding onto that press release. Let's not forget Smith Micro Software Inc. (SMSI). Internet chat rooms wereall abuzz with talk that the company's Internet commerce software, WebCatalog,includes a Linux version. The stock finished up 12% at 6 1/2 after trading as high as 11 3/4, another52-week high. Its chief executive, William Smith, attributed the stock's rise tothe firm's entrance into e-commerce in September and its Macintosh segment, inaddition to its Linux launch in November. But the biggest winner by far Friday was Zitel Corp. (ZITL), which ended up488% at 6 1/4 after word got out that its Datametrics performance-managementsoftware supports Linux. Keep a lookout, however, because the failed Y2K-software maker hasn't yetactually sent out the official word. That is, it hasn't issued its Linux pressrelease yet. "The only way to tell if (Linux) is a trend or fad is to look back," saidBitWise's Botti. "I think there's more to it, it's more than a fad, but onlytime will tell." -Marcelo Prince; Dow Jones Newswires; 201-938-5244 (END) DOW JONES NEWS 12-13-99 08:55 AM