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

To: J Bertrand who wrote (8814)	1/17/1998 12:39:00 PM
From: J Bertrand	Read Replies (2) \| Respond to of 14631

Friends, Here's another thing to debate while we wait for earnings. The database vendors are all trading between 3 and .7 price to sales ratios while the ERP vendors are all trading above 12. I think we have some crazy valuations here. Somebody (possibly are ERP friends) is going to be very disappointed. PSFT 12.2 (P/SALE) 253 MILLION SHARES OUT $33.68 BAANF 12.6 (P/SALE) 206 MILLION SHARES OUT $34.50 ORACLE 3.1 (P/SALE) 1.006 BILLION SHARES OUT $19.43 INFORMIX 1.1 (P/SALE) 151.7 MILLION SHARES OUT $5.187 SYBASE .07 (P/SALE) 87 MILLION SHARES OUT $8.93 If the market is slowing because of "less" opportunity and because of the year 2000, then why won't the ERP companies have some of the same problems as well? How is it possible that the ERP companies are immune from the 2yk? How can anyone justify over 12 times sales for these stocks? One mistake and these stocks are going to be trading below 15. While there may be some justification because of the perceived opportunity in this area, I think these guys are a disaster in the making unless it is true that these markets are going to continue to explode. I don't have the guts to buy these stocks right now. Conversely, Informix, Sybase and Oracle are trading at ridiculously low price to sales ratios. How could one part of the same coin be a "disaster" and the other side of the coin be "wonderland". I think like most things in life, it is somewhere in between. The ERP's are certainly going to have more success maybe not quite as exuberant as everyone thinks, but the database companies aren't done yet. Far from it! Here's another amazing thing to think about. Peoplesoft is trading at 33 with 253 million shares out. Informix is trading at 5 with 151 million shares out. This is happening with Informix having more revenue than Peoplesoft. If Informix can get its act together (profitability), Informix is going to be on a vertical flight plan. Right now, we are all sitting on surf boards waiting for the next wave. One of these database companies (could be Informix) is going to start the ball rolling again. Somebody is going to prove that this slowdown was really a temporary "pause" in the market. When that happens, look out. Fasten your seat belts. Jeff Bertrand