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Technology Stocks : PROGRAMMER'S PARADISE (PROG) -- Ignore unavailable to you. Want to Upgrade?

To: Craig Lacy who wrote (2175)	4/20/2000 2:03:00 AM
From: Carl R.	Read Replies (2) \| Respond to of 2383

Yes, I think margins are definitely being squeezed, in particular by tight margins on the web. Note however that as the cash sucking internet software retailers face the serious threat of running out of cash with no way to raise more they may well have to raise prices, so margins could well improve as the year goes on. Even at the loss of a nickel PROG has a positive cash flow though due to goodwill write offs, and PROG has a big pile of cash on hand. Introducing the Cash Suckers: Cash Sucker #1=EGGS: With the exception of December 1996 they have never made a profit. In the last several years they have lost $8 a share, and they are expected to lost $3 more this year and next. They have $65 million in cash as of 12/99, or $2 a share, thanks to lots of secondaries. Not counting merger costs they lost $40 million in Q4. Without a supply of new money they shouldn't last too long. Analysts estimates call for a loss of about $.60 a share per quarter, or about $25 million per quarter, so they should run out of cash by Q3. Cash sucker #2=BYND - BYND is the walking dead, though they claim that reports of their death are greatly exaggerated: biz.yahoo.com With $66 million in cash as of December, and losing and estimated $18 million a quarter (not counting an $11 million restructuring charge this quarter), cash could start getting short by Q4, depending on the success of their restructure. Cash sucker #3=COOL - With nearly $5 in losses per share over the last several years, and never a profit, this company can suck cash. On the other hand, they generate more margin that some of the others, and run with lower overhead. They had $66 million in cash as of the end of February, and with expected losses of about $.30 a share per quarter, or (only) $8 million per quarter, they could lose money for another 2 years without running out of cash. On the other hand, a profit is definitely not likely. Cash sucker #4=buyx - Post IPO, they were expected to show pro forma cash as of 12/21/99 of $167 million. On the other hand they are expected to lose about $140 million in 2000, which will mean that they could run out of cash in Q1 2001. With some heavy hitters on the board, including John Scully and an Ingram, they may be able to raise more money later, if they are making headway towards profitability, but if not.... cash sucker #5-ITRA - With only $27 million in cash, and losing $11 million a quarter, it would seem that they might run out of cash in Q3. But don't worry, the CEO says cash will last until 2002: dailynews.yahoo.com Don't ask me how, but if he says so.... Cash sucker #6-DRIV - DRIV is losing only an estimated $8 million per quarter this year, and unlike most of the cash suckers, is expected to lose less next year. They are sitting on $54 million in cash so I don't think they will run out of cash unless their business model ends up failing, which I don't think it will. Carl