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Technology Stocks : NT Accounting Software (GPSI, PSQL, SOTA, TMBS) -- Ignore unavailable to you. Want to Upgrade?

To: WTSherman who wrote (109)	12/6/1997 11:15:00 AM
From: Trader Dave	Read Replies (1) \| Respond to of 149

SOTA is unlikely to crush estimates this quarter. The acuity release is still far from complete. I don't expect a complete high end app line up until mid 98. Moreover, their y2k compliant mas 90 product doesn't ship until first quarter. tone of business is ok, but the management is not loved by the street. TD

To: WTSherman who wrote (109)	12/6/1997 11:15:00 AM
From: Veiko Herne	Respond to of 149

Re: Anyone out there following SOTA? Of course. I'm following SOTA and owning some shares. If the market of client-server business applications for middle size business increasing 200% per year, nobody can't be looser here. I'm also owning a BEST software, which develops Human Resource Management Software and most of this class accounting softare companies are OEM agreement with Best (like Solomon and SOTA). Best is making same kind of financial results as SOTA or TMBS, but stock is still $10. Seem's very undervalued to me (and for this Company also, because they are currently buyng back stocks). Maybe we should include BEST thread also here? It's not accounting, but anyway same class business software product. Veiko

To: WTSherman who wrote (109)	12/7/1997 7:56:00 PM
From: Alan A. Hicks	Respond to of 149

SOTA hit a new 52 week high today on about 5 times average daily volume. SOTA may be about to receive the benefit from what some money managers call the "triple whammy." 1. Accelerating earnings growth - even Robertson Stephens (who is still has a neutral rating on SOTA) projects 100% earnings growth over each of the next four quarters. 2. Multiple expansion from a low valuation level - SOTA is still just over 3.5 times this years revenues. Great Plains (GPSI) has traded in the 5 to 8 times revenue range. At 5 times this years revenues SOTA would be $27 per share. At 8 times revenues SOTA would be $43. Next year, at 5 times 1998 revenues of $85 million SOTA would be $35 per share and at 8 times be $56 per share. 3. Momentum investors jump on board as SOTA continues to make new highs and as SOTA receives more coverage from analysts who discover that SOTA is growing rapidly in what is becoming a hot investment theme - NT financial application software. For this scenario to unfold fully, SOTA will need to meet strong Q4 expectations and demonstrate that Acuity and MAS 90cs for NT are both showing strong growth, that SOTA is able to increase service revenues from its new maintenance contract program and from new consulting services, and that SOTA is building a strong financial foundation with conservative accounting practices and strong cash generation. Current analyst estimates for Q4 are $0.31 up 125% over last year and 20.3 million in revenues, up 30% over last year. This appears doable based on a strong market for the mid-range financial market, new product releases across SOTA's entire product line, the traditional strong Q4 for SOTA, which includes an extra $1 million in annual payroll tax table upgrades, and projected lower expense levels in Q4. SOTA should also generate another $4 to $5 million in cash. Management presentations to analysts at recent financial conferences have been very upbeat reporting a healthy tone of business. I checked with a few large SOTA resellers last week. These resellers reported their business is strong, up 50 percent or more over last year. Sales of new maintenance contracts have been particularly strong because the next maintenance upgrade to MAS 90 will include year 2000 support. Sales of MAS 90 cs for Windows NT was also reported to be quite strong. A new UNIX version of MAS 90 cs expected to ship in December will support Windows NT clients and resellers report they have strong pent up demand from current UNIX clients. MAS 90 resellers are also finally starting to make some significant Acuity sales. Some notable customers include Banc One, Weyerhuaser, and Lockheed (also a vertical partner). SOTA has broadened the number of modules and functionality of Acuity this quarter with three major releases of Acuity. Acuity 2.0 began shipping at the end of September which added Purchase Order, a Customizer, a Web reporting module and also several functionality additions to core modules. Acuity Projects, which offers a full suite of modules for project related services companies, began shipping in November. Acuity 2.5 is set to ship in December. It will upgrade Acuity to Visual Basic 5.0 (well ahead of the competition) and also add more functionality to core modules. Acuity 3.0 which will add more new modules completing a full application suite will ship around mid 1998. As we enter 1998 investors will begin looking at 1998 and 1999 analyst projections. SOTA is expected to $0.82 to $0.95 in 1998. Analysts will probably have 1999 estimates coming in around $1.10 to $1.30 depending on how analysts perceive the success of Acuity. Acuity growth should accelerate in the second half of 1998 as 1) Acuity 3.0 rounds out a complete application suite 2) vertical partners such as Lockheed and others begin introducing their offerings based on Acuity and 3) international distribution begins to make a meaningful contribution. The NT financial applications market is quite robust. Last week JD Edwards (JDEC) reported their revenues grew over 40 percent in the recent quarter citing strong interest in NT applications. GPSI should also report strong results for their Q2 later this month. Also, FlexiInternational, is set to go public this month and is expected to be another hot IPO for a NT financial applications company (following GPSI and JDEC). Flexi is expected to start trading in the 10 times revenue range. I have also heard that analysts covering the high-end financial applications (PeopleSoft, Baan, and SAP) companies are anticipating lower growth rates as the high-end becomes more saturated and competitive. They expect these companies will begin to look to what is being called "mid-range enterprise" financial applications vendors as acquisition candidates to maintain high growth rates. The obvious candidates are SOTA, PSQL and GPSI. With SOTA's lower valuation and their all Microsoft standards based Acuity, SOTA could become a sought after acquisition target.