To: Bill Wexler who wrote (1481 ) 4/16/1998 1:59:00 AM From: uu Read Replies (1) | Respond to
Bill,1. Anticipation of an impressive earnings report and/or future earnings growth. 2. Momentum generated by either those who are short being squeezed and/or the company being associated in a hot sector of the economy that is believed to have an impressive growth (eventhough that company has not yet shown any growth of its own).thin client/server centric architecture) the need for software security is rising at an astornomical rate. Despite the fact that there are already quite a few companies that provide such products, the demand at this time exceeds the supply. Furthermore because of the number of small players in this particular sector, the consolidation will definitely be in order. server centric computing model via Java) with award winning and known products. Therefore logic (at least my logic) dictates that CYBG is on its path to an impressive growth rate. Additionally if you compare CYBG with its rivals (with less of an established market) such as ISSX, you notice that its (i.e. CYBG's) multiples are very much lower than theirs. This means CYBG still has a lot further to go to be valued at the same level as its rivals (my estimation is to at least $25/shr).overvaluation. The source of this wrong perception is their lack of understanding of this sector and the new computing model (as defined and adopted by the industry via Java). This will result in an increase in the number of shares shorted. However, what ends up happening (IMHO of course) is that because these sectors are growing at an astonomical rates (again due to Sun's new computing model as adopted by the industry) companies such as CYBG will be showing impressive earnings and revenue growth rates. This will only attract more investors to the stock resulting in a harsh short squeeze and adding to fuel resulting in higher stock prices for companies such as CYBG.
