Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: schrodingers_cat who wrote (115217)	1/12/2001 8:40:07 PM
From: GST	Respond to of 164684

The market is teaching us what happens to the price of high growth tech stocks if-and-when their high growth tapers off to slow growth -- or worse. Many people saw this coming -- I am amazed that it still causes debate. Thanks for the thoughtful posts.

To: schrodingers_cat who wrote (115217)	1/12/2001 8:46:45 PM
From: Sarmad Y. Hermiz	Read Replies (1) \| Respond to of 164684

sc, thanks very much for posting the links to Ariba articles. I guess despite determined efforts to remain ignorant, I will have to educate myself on this subject.

To: schrodingers_cat who wrote (115217)	1/13/2001 12:35:38 AM
From: Bill Harmond	Read Replies (7) \| Respond to of 164684

Lemme get in here. You guys are hanging up on sequential revenue growth rate numbers. Look at the numbers themselves. Look at the ramp, look at the margin improvement. We're dealing with big numbers all of a sudden. Y/Y 4Q00 revenue was over 7x 4Q99. Seven times! Anybody, name any company that has been cash-flow positive for 14 quarters, and just reported 600%+ revenue growth. Secondly, the term license thing is causing everybody's spreadsheet to blow up because they can't get the formulas around it yet. Ariba has decided that it will charge almost the same price but limit the license to three years. That act is a statement of management belief: First the market will pay it even though it's a huge price increase. Second, nobody's coming along within three years with better technology. Imagine what Microsoft could have made with term licenses instead of perpetual licenses. The dot.com receivables thing is nothing but wounded egos. The CEO said that he has now set aside enough money so that dot-com will never need any more discussion. Pretty plain talk. This set-aside came right out of earnings during the past two quarters, yet Ariba blew away estimates in both of them anyway. The company said that dot-com business is inconsequential. There is no issue here. DSO's is up because the Far East pays everyone more slowly. Ariba's DSO's are among the lowest anyway. The only way to appreciate this story is understanding the size of the marketplace, Ariba's 2/3 share, and the ROI. The ROI puts these projects at the top of IT spending priorities, hence no slowdown.