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To: UnBelievable who wrote (77057)	3/8/2001 9:16:50 AM
From: Earlie	Respond to of 436258

Un: Right! (g) Best, Earlie

To: UnBelievable who wrote (77057)	3/8/2001 9:24:08 AM
From: Box-By-The-Riviera™	Read Replies (2) \| Respond to of 436258

NEW YORK (Dow Jones)--James Moore of Deutsche Banc Alex. Brown became the latest analyst to sound a cautious tone and lower his estimates for the software sector. In a research note Wednesday, Moore said the "fundamental outlook for software companies has weakened considerably" in the wake of Oracle Corp.'s (ORCL) preannouncement and mounting evidence of slower information technology spending. The analyst lowered his revenue and earnings estimates for the next two fiscal years and reduced his growth targets on six software companies, including Ariba Inc. (ARBA) and i2 Technologies Inc. (ITWO). He didn't change his investment ratings. Several investment banks, including Goldman Sachs & Co., Morgan Stanley Dean Witter, Credit Suisse First Boston Corp. and Thomas Weisel Partners, have similarly made sweeping estimate cuts for software companies in the wake of Oracle's warnings. Some brokerages also downgraded numerous ratings. Moore also outlined for investors three possible scenarios for software stocks this year. In the most optimistic case, IT spending will snap back shortly and software stocks return to their traditionally high valuations. The stocks then would soar on average more than 85%, Moore calculates. In the bearish case, continued weak IT spending prompts analysts to reduce estimates by 15% to 30% and stock multiples continue to compress. Battered software stocks would then drop by an additional 36% on average, Moore estimates. However, the most likely scenario, Moore said, would be a modest pickup in IT spending from February's levels with analysts' estimates being slightly reduced. This would allow software stocks to rally an average of 35%, he said. Moore's top pick in the group remains Mercury Interactive Corp. (MERQ). It has low-priced products that can be quickly set up, so it might be spared the budget cutter's axe. However, Moore noted that Mercury's valuation and market risks still pose "significant downside potential over the medium term." As for Oracle, Moore warns that "in a prolonged economic downturn, downside risk in Oracle shares could be up to 40%." Moore set a 12-month price target of $20 for the database giant, only slightly above Tuesday's $17.63 close, but said the shares could trade much higher if the economy and stock market recover quickly. The six companies whose estimates Moore cut Wednesday were Ariba, i2, Commerce One Inc. (CMRC), BEA Systems Inc. (BEAS), Business Objects SA (BOBJ) and Tibco Software Inc. (TIBX). Moore still awards these stocks buy recommendations. -By Marcelo Prince, Dow Jones Newswires; 201-938-5244;