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Technology Stocks : MAPINFO: Any Thoughts -- Ignore unavailable to you. Want to Upgrade?

To: Luce Wildebeest who wrote (205)	1/23/2000 2:01:00 PM
From: Alan A. Hicks	Read Replies (2) \| Respond to of 225

MAPS blew away revenue expectations for Q1 with $21.5 million in revenues with expectations in the $19 ? 19.5 million range. EPS were $0.11 up 54% year over year. While EPS beat analyst expectations in the $0.09-$0.10 range, EPS were held back by both a higher than expected tax rate at 37% but mostly by higher spending. (MAPS reported $0.18 in the Sept. quarter on the same revenues.) This suggests to me that MAPS is investing in the future of growth of the company. Last quarter the company talked about increasing the sales force by 50-60% this year. I think this is the 10th quarter in row they have beat expectations. Operating Income rose 113%. Management seemed very confident expecting revenue growth to maintain the 30% growth rate this year. Management emphasized growth in telecom, which is 40% of revenues, and the new Customer Relationship Management (CRM) products. Data sales continued to provide rapid growth and are building a recurring sales base and now represent 39% of sales. The $5 million order with a major telecom company announced two weeks ago will provide recurring data sales of $1.3 - $1.4 million each year. Management expects a continuing strong relationship with Oracle and Oracle8i for location-based analysis. At 28% percent growth and 10% margins MAPS should earn $0.70 next year, which is in line with analyst expectations. In 2001 management expects operating margins to improve to 15%. At a 29% percent growth rate that suggests EPS of about $1.20 in 2001. Analyst expectations are in the $0.95 to $1.10 range. New products under development are location-based software for wireless-handheld devices. MAPS also made an investment in an internet startup, Nearme.com, that will provide maps and information on where to find a business you are looking for. MAPS also expects to increase on-line services for businesses on an application service provider (ASP) basis - (per use or short-term use of MAPS' data and software.) Report.zone was MAPS initial product announced in this area. These new products are expected to add to sales next growth year. MAPS at $24 is selling for about 3 times trailing revenues. With MAPS strong and growing momentum in high growth telecom and CRM applications; and the growing recurring revenue sales base; I believe MAPS should sell for at least 5 times revenues. This would result in a 12-month price target of $50 per share.