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Technology Stocks : Trading TAVA -- Ignore unavailable to you. Want to Upgrade?

To: Jack Zahran who wrote (113)	2/23/1998 11:59:00 AM
From: Skeptic	Read Replies (2) \| Respond to of 655

If Tava does Y2K remediation work for a client and then gets a systems integration contract as a follow-on, profits from the follow-on contract are not Y2K earnings. This is what we have been calling the leveraging of the Y2K business. When I said that Y2K earnings will not recur, I was talking about earnings from Y2K projects. I fail to see how this radical concept makes me naive. As far as Y2K leveraging the base business goes, I agree that it will clearly be a benefit, but feel that both the amount and certainty of that benefit are being over-estimated. Tava is the only source I've seen for projections of growth in this business. Does anyone have any research on this from an independent market research firm like Gartner? Also, you seem to be assuming that Tava's strong position in Y2K naturally extends to systems integration. I expect there to be much more competition for this business. Finally, Y2K has created a huge spike in demand for services. Prices are rising and supply is increasing to meet this demand. After 2000, demand will return to more normal levels and there will be excess supply. Every company benefiting from Y2K cannot possibly leverage it into more business beyond because there will simply not be enough demand for the available supply of services.