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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Mike Buckley who wrote (12861)	12/16/1999 3:50:00 AM
From: Bruce Brown	Respond to of 54805

Mike, I don't have the Oracle CRM numbers from the last quarter, but I remember it was something like the high teens. Pretty amazing since they have no product yet. ;-) Just some thoughts about Oracle. I know many have dismissed it on this thread, but I'm not counting them out by any means. Regardless, it was quite a day for three of the Silverbacks yesterday. Oracle, Microsoft, Intel - all up for the obvious reasons. Ballmer confidently wields Windows 2000 and Oracle's post quarterly numbers sends the stock soaring. Too bad Cisco got dampened by a routine sentence in the 10-Q. It seemed like a lot of sideways money being taken out from other recent high flying stocks and moved into the Silverbacks. Microsoft and Oracle breaking out to new all time highs at year end while portfolio managers are busy adjusting their underwear, hordes of cash is coming to the market and hordes of cash is also sitting on the sidelines. What's a long term investor to do? Nothing. Just sit and enjoy the continued ride some of the old Silverbacks can provide as core holdings. Regardless, I listened to the Oracle CC. It is important to note how the Internet itself (as the big Gorilla) is having an effect on these companies that are scrambling to 'adjust' to it. The largest growth came from Internet based eApplications coming in at 31% sales application gain. Margins improved 5.5% - which is not a bad thing. Oracle needed another source of revenue outside of the database category of which they are the gorilla. I would venture to guess that this represents the dual games being played in the enterprise software arena. The 'big' players are the dominant (gorilla) force in their specialty and the Internet is allowing them to duke it out in the royalty aspect of eBusiness applications because of the value chain the Internet is creating. The nice long term look about the Internet as a Gorilla is that in terms of technology adoption life cycle, the longevity seems pretty compelling. Interesting to note that the majority of Oracle's cost cutting campaign is yet to be carried out. Historically, we know what happens to Oracle's stock when it gets up to these levels in terms of split announcements. I don't know off hand what they have in the way of authorized shares, but it wouldn't surprise me to see them fire the S word in the not too distant future. They are 'not' seeing anticipated Y2K lock down spending. In retrospect, that scare earlier this year may have been one of the most fruitful investing opportunities in the enterprise application software arena. I think Oracle is up about 244% in the past 12 months. siliconinvestor.com Usual stuff. Ellison is going to 'take over' Microsoft, blah, blah, blah... . However, from an investor's viewpoint, I will continue to not let the mouth get in the way of my judgement. Although I had moved out of the majority of my long term position in Oracle earlier this year, I added more in my IRA a few months ago to be in my 'basket' approach of the eBusiness side of things. My belief is that the stage is so large for the players in this theater that it's not going to be a 'winner take all' or come down to one dominant force for the eBusiness side of the applications market. The value chain will support a lot of wealth accumulation for those positioned well. BB