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Technology Stocks : i2 Technologies -- Ignore unavailable to you. Want to Upgrade?

To: Rick Bullotta who wrote (299)	4/18/1998 10:24:00 PM
From: Timoteo	Read Replies (1) \| Respond to of 2339

Stuffing the channel is far more common than you realize. I've only had one company I was long in (TEAM) get caught doing it, but there are many creative ways to book sales. A simple test for i2 is to look at receivables when earnings come out Thursday. i2 is a heavily manipulated stock and is currently under distribution by insiders. If you watch how it trades on a given day you'll see that it can move several points with only hundreds or thousands of shares traded. Its a great day trading stock if you have level 2, but long-term I'm short (no pun intended). The software stocks typically command the multiples they do based on sequential growth of both earnings and profits. The bull has been kind to the industry as long as the revenue side has held up, but anybody in the business knows the service and support margins are getting creamed because of labor costs. The software industry has value-added their products by selling solutions. The reality is that the profit margin is nothing like selling shrink wrapped boxes of floppies and a manual. If the market corrects, stocks like i2 will get hit extra hard. I assume that the recent price action is an attempt to pump the price as insurance against any reaction against earnings. i2 typically falls after the announcement. If the predicted slowdown in the industry materializes in the first quarter of next year, i2 could be another CLFY or RMDY. Best Wishes, Timoteo