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Technology Stocks : PEGA - Pegasystems -- Ignore unavailable to you. Want to Upgrade?

To: Geof Hollingsworth who wrote (322)	11/20/1997 4:14:00 PM
From: Clam Clam	Read Replies (1) \| Respond to of 504

Geof, I agree with what you say. I was trying to make the best guess about the numbers in relation to others - not necessarily figure out what they are actually reporting (that is impossible). I did hear them say they recognized $1mm in Q3 and that they didn't have any FDR money in their receivables, did FDR pay them cash already?? re. Rick Sherlund, he lives in the fantasyland of analysts where your NAV isn't printed on a daily basis so he can put the stock on the Global Priority List for all I care. I don't know if PEGA is over or undervalued as I don't pretend to know what is going on (do they??). All I know is this management is not conservative or big on disclosure. That is two strikes against them that are not reflected in the valuation so I am just going to let it trade. I hope it goes up because for every dollar it goes up, VNTV, SEBL and others look that much more attractive on a relative basis. Last time I checked, analysts are still under $70mm in estimated revenues for 1998. VNTV and SEBL will do $200mm (SEBL probably more). The P/E looking reasonable for PEGA is due to the difference in the anticipated margin, which is all on the come. PEGA is targeting 60-80 salesmen by the end of 1998 and 40 by year-end. Not only is that significantly lower than comparable companies, the expected quotas are only $40k/mo. FDR is a good deal but FDR is a reseller which has basically replaced PEGA salesmen. Does this mean all leads are now turned over to FDR and salesmen start from scratch? This is good from a margin perspective as costs aren't big with a reseller doing the work for you but having the customer one step further away can be viewed negatively as well. Tom Siebel says customer service is what he bases ALL compensation to his salesmen on as he views it as, by far, the most important issue. PEGA was a consulting company for a LONG time and I am skeptical over whether they have the business savvy of running a product company, especially a public one. Maybe they can make the transition but I say, prove it to me before I buy into a 10x 1998E revenue multiple. Rick Sherlund knows more than I do about their pipeline and Rick is a pretty good analyst, but even Rick calls this a "show-me" stock. Rick, like the good investment banking conscious analyst he is, gives them the benefit of any doubt, I don't. li li, I hope you didn't take my previous comment the wrong way. I was not trying to intimidate you into not posting on SI, I was just joking around. No hard feelings, I hope. Shege, you of all people should have realized my intent was not malicious. paul, I don't know what to make of your post. I tend to enjoy periodic tounge-in-cheek conversation, if you don't like it, tune it out as I do to any bs I read on these threads. IMO, a little confrontation on a thread helps now and then as people are offended into doing some real work on the subject at hand. Peace to all.