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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: BANCHEE who wrote (18028)	1/6/2000 9:33:00 AM
From: Rande Is	Read Replies (2) \| Respond to of 57584

TIER: [Tier Technologies, Inc.] Banchee: I don't think you will see your 7 entry. I was going to wait until later to discuss this one. . .but I have a few seconds. . . TIER [Tier Technologies] is an IT company with extraordinary growth and has been way undervalued, IMO. Many thought it was part of the Y2K sector, so it was beaten down. . . but in fact, that is not an area that TIER was much into at all. From Yahoo: biz.yahoo.com TIER provides information technology consulting, application development and software engineering services that facilitate the migration of clients' enterprise-wide systems. For the nine months ended 6/30/99, revenues increased 78% to $65.4 million. Net loss totalled $170 thousand vs. income of $2.2 million. Revenues reflect internal growth, an expanded client base and new contracts. Net loss reflects the inclusion of a $4 million purchased in-process technology charge. Price to Sales ratio is currently around 1! Price Earnings Growth rate is around 0.14! Comparitively, Computer Services sector averages a PE growth rate of 6.09. . . and S&P averages 2.35. Recent news: Appointment of new CFO: biz.yahoo.com $17.4 mil contract with the state of Kansas: biz.yahoo.com Acquires Australian IT firm: biz.yahoo.com Fourth quarter: biz.yahoo.com Strategic Alliance with Siemens: irconnect.com Contract with the state of Tennessee: irconnect.com Company does IT work for 28 different states. Yet unannounced alliance with Ariba [ARBA]: ariba.com Institutional ownership: 39% (72% of float) (58 institutions) Shares Outstanding 10.8 mil Float: 5.8 mil Earnings Whisper reports next quarterly is 02/05/00: earningswhisper.com Whispers to beat the street. Chart showing some signs of life: clearstation.com Company website: tier.com Commentary: There was a massive trade near 5 back in May. . .not sure whether this was long or short. . . however the very same uncharacteristic amount was traded just before the end of 99. . . . leading to believe one of the following: 1.] Someone took a large short position, in hopes of what they thought was a Y2K company would go down the dumps. . .then covered just before the end of the year to take their loss before years end. 2.] Someone bought a ton of shares in hopes of a turnaround. . . stock traded sideways. . .they pumped it in late December and sold out on the spike. Either way, it appears this party has completed their trade. And since the big spike in late December, the stock has held up exceptionally well. . . .which has begun to trigger some positive TA. Downside risk is minimal at the current level based on earnings growth. Upside potential is more than double from this level within 6 months. . . based on the undervaluation and the pending ARBA announcement. . . My guess is that the Tier CEO has not only cut an alliance with ARBA, but has been running around cutting deal after deal with the new crop of Business-To-Business E-Commerce companies. . . . some of which are demonstrating they are clueless. . .hence the recent firing of FMKT by General Motors. The stock price has mostly floundered during 1999, despite excellent earnings and revenue growth. . . I attribute this to TIER being mistakenly lumped into the Y2K sector. I see TIER as an undervalued long-term hold. . .a position on pending news, undervaluation and TA. Rande Is . . NOTE: I am not a financial advisor or broker. I currently hold a small long position in TIER. I plan to sell part or all of my position somewhere in the mid to high teens. Do your own DD.