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Technology Stocks : PSFT - Fiscal 1998 - Discussion for the next year -- Ignore unavailable to you. Want to Upgrade?

To: Smooth_Sailing who wrote (367)	3/31/1998 1:01:00 PM
From: Rick	Read Replies (1) \| Respond to of 4509

Responding to a few different messages: Paul - I guess you were just flirting with the Gorilla ideas. Sorry if I implied that you had gone off the deep end. I enjoy a good investment argument, so I don't beat around the bush. I have noticed though that my enjoyment of a competitive battle of ideas does not translate well to a text only medium. Every idea or challenge that I post has either a friendly or sarcastic smile behind it. Tom - Outstanding illumination of difficulty in identifying Gorillas. Other Thoughts For What It's Worth: I have finally hedged my Peoplesoft call options by selling April and July 55's to match against my April and July 25's long (heckuva ride; purchased when PSFT was at split adjusted 25). Peoplesoft seems to be struggling a bit recently (last couple of weeks). The following thoughts are running through my mind: 1) The rumors about a possible acquisition of Vantive continue. The companies have a shared executive (VP at PSFT and Board member or VNTV) and PSFT uses Vantive in its support operation. Surely PSFT will enter the front end customer interaction business at some point, so the takeover idea is not unreasonable. Vantive has also run up from 25 to 37 in the last few weeks adding to the speculation - it doesn't seem like it could make this move on its own earnings merits, but who knows. Anyway, VNTV is currently a $900 million market cap. The acquisition would be accretive to earnings but probably bring the growth projections down a notch or two. Downside probably to around $45 if an acquisition occurs (guestimation). Probably long term positive, in that PSFT needs the front end components, could leverage each others customer base. The downside - I have no idea about the integration challenges from VNTV to PSFT architecture. All the buzz in the analyst community seems to be that the quarter is going well, so there is probably still some upside in the short to medium term. If the stock breaks 60, I will buy puts as a combination hedge and speculative play that a acquisition will happen shaving a few points. Mostly a hedge on my existing spread position, though. I have carried the position for 6 months, done well, why push it ? Any technology pros that have an opinion on the Vantive Peoplesoft integration challenges ? Rick.