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Technology Stocks : IFMX - Investment Discussion -- Ignore unavailable to you. Want to Upgrade?

To: bob zagorin who wrote (14078)	4/28/2000 6:22:00 PM
From: M. Charles Swope	Read Replies (1) \| Respond to of 14631

Bob, You are probably right that increases in DSO numbers were an industry wide phenomonen and that IFMX's increase was not out of line compared to others. However, the point remains that IFMX might be penalized more than others for such an increase because of the company's prior history. Just to be clear. I am NOT saying that IFMX is doing anything shady like pushing product onto distributers and booking unwarranted sales, only that the investment community is going to have an exaggerated reaction to an increase in the DSO number when it comes to IFMX. Charlie

To: bob zagorin who wrote (14078)	4/28/2000 11:27:00 PM
From: Howard Armstrong	Read Replies (1) \| Respond to of 14631

Nope .. "Y2K spending freeze" not an excuse for inflated DSOs. Y2K did not cause companies to stop paying invoices on POs (Purchase Orders) they already issued. They may have delayed buying new software, but that would have affected revenue, not accounts receivable. Yes, you are seeing it across the industry, but that's because sales to fly-by-night dot-coms are turning sour now that the market is down. The dot-coms can't pay their bills now. Anyone who believes "the current CEO wouldn't let this happen" is naiive. There are lots of things he could do besides cram product into the channel. Selling to foreign customers with a questionable credit history is one of them. Selling to fly-by-night dot-coms is another. Sales rep side agreements is another. (This is where a sales rep creates another contract, making promises that allow the customer to back out of the deal.) When you're faced with a juggernaut competitor like ORCL, you take what you can get. Yeah, I know I am speculating (I don't really know why the DSOs went up), but the IFMX has not explained what happened, so they have left it up to the market to guess. They give the impression that things are not being managed properly.