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Strategies & Market Trends : Cents and Sensibility - Kimberly and Friends' Consortium -- Ignore unavailable to you. Want to Upgrade?

To: swisstrader who wrote (73070)	2/9/2000 12:41:00 PM
From: Bouf	Respond to of 108040

TXB..will take the ride for a week or two..

To: swisstrader who wrote (73070)	2/9/2000 12:42:00 PM
From: Jim B	Respond to of 108040

DTEC hit $64... here come the first round of flippers... back to $58 now... looking for intraday bottom before moving higher.. this one has alot of sex appeal to it About: Delano Technology is a developer of e-Customer Relationship Management Programs. Delano's technology is designed to allow their customers to use the Internet, e-mail, and other web related technologies to enhance customer experience. Also recently Delano has broadened their offerings to focus in further on helping companies use e-mail and the Internet to communicate more efficiently with customers and suppliers. The company's Delano Business Interaction Suite is the basic platform by which Delano builds unique e-CRM solutions for their customers. For instance in the financial sector, Delano offers customers the ability to create streamlined e-mail systems, approve and integrate loan approval databases with e-mail systems, improve customer support, enable financial service firms to e-mail balances and bills, and other unique services. Key customers include Mark VII Transportation, Commerx, Vitamins.com, and others. Key Competitors: Kana Communications, eGain, Chordiant Software, Clarify, Mustang Software Financial Information: 1998 Sales: 0 1999 Sales (for the nine months ending December 31, 1999): 5 million dollars 1999 Net Income: Loss of 1.7 million dollars 1999 Net Income (for the nine months ending December 31, 1999): Loss of 4.6 million dollars IPO Information: Range: 9 to 11 Float: 5 million shares Post-Offering Shares: 28.424 million shares IPO Valuation (based on a price of 11 dollars): about 312.7 million dollars Underwriters: Lead: Robertson Stephens Others: U.S Bancorp Piper Jaffray, CIBC World Markets Analysis: This deal is very similar to the Chordiant Software deal which is also being led by Robertson Stephens. Unlike Chordiant though, Delano primarily is focused on e-CRM or Internet/e-mail based CRM. This isn't necessarily a bad thing, when you consider that traditional CRM is dominated by more established firms and e-CRM is growing faster than traditional CRM. On the other hand, a company that provides a complete end to end solution would most likely be preferred by companies looking for a CRM solution. The company's financials look pretty good, with sales growing briskly and losses aren't as large as many of Delano's competitors. In terms of valuation, Delano looks cheap compared to competitors. Based on a 150 price to sales ratio, which is a little lower than the average of eGain and Kana, Delano would be valued at about 750 million dollars which is more than double the current valuation based on a price of 11 dollars. Due to Delano's strong growth and more focused e-CRM solution, they may be valued more along Kana's price to sales ratio of 230, than eGain's much lower valuation. Based on that Delano would be significantly undervalued. Also you can't assume that Robertson Stephens won't raise the range on this deal and thus the valuation. We expect they will. In terms of the underwriters, this deal is very strong in that aspect as well. Robertson Stephens is one of our favorites. Overall expect a very strong deal.