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Technology Stocks : Manugistics, Inc. (MANU) -- Ignore unavailable to you. Want to Upgrade?

To: Big Sky who wrote (639)	5/23/1998 2:19:00 PM
From: Tom Hua	Read Replies (1) \| Respond to of 1670

Steve, the drops in RMDY and CLFY that you mentioned weren't the first hits they suffered. As I recall from memory, RMDY tumbled from the 30s to 20s in 1 day when the warning first came out. It continued to drift down and then took another big hit from 19 to 12 3/4 on the date the actual earnings (still earnings, not losses like MANU) were released. CLFY took several stepwise declines from 52 before bottoming at 6. INFR had the same pattern, from 20s to 4. ATEA was hammered from 23 to 8 in 1 day, only to see more declines and never recovered. Currently, at < 3. These were all high flying software companies in a "hot" and fast growing sector. Once they are no longer street darlings, watch out below. I'm sure at some point, MANU will be a value play, but IMO, it's not there yet. Regards, Tom

To: Big Sky who wrote (639)	5/24/1998 12:13:00 AM
From: Clam Clam	Respond to of 1670

I like your DCB number crunch. However, I think RMDY and RATL aren't relevant at all. RATL is a tools company, not an apps company. RMDY does the internal help-desk and that is not a strategic app, just basic (commodity) infrastructure which everybody and their brother can do (NETA, IBM + about 10k other standalones). CLFY and SCOP are more strategic so they are closer but those are 'automation' apps not 'optimization' apps. CLFY's blow up was a lack of sales hiring, a A/R stretch and a change in accounting policies. SCOP was a sales execution issue (complexity and deal size increases) like MANU was. But SCOP stumbled at much smaller levels of revenue so I think everybody figured that if they couldn't grow at that tiny a size, it wasn't a real company. MANU is a real company, so I doubt it will be as given up on as SCOP but if SCOP can lost 71% of its value ($35 to $10), MANU could lose 60% from its high ($65 to $25). Who knows? That said, if SCOP's technology value was realized with a merger price as a double off the low ($20), MANU's definitely could too - even more so given the scarcity value (how's $50 sound??). SAP is going to try to do SCM on their own but PSFT, BAAN, ORCL and JDEC understand that they do not have the resources and cannot get the engineers to do anything within spitting distance of MANU and ITWO (and SAP's eventual product). PSFT bought Red Pepper but Peoplesoft really isn't a player in manufacturing anyway, they target services companies. That leaves Baan, JD Edwards and Oracle. Hey, maybe i2 buys MANU like SEBL bought SCOP just so no ERP can get 'em. Did you hear that Goldman Sachs?? - go to Irving, Texas and make the merger pitch next week.

To: Big Sky who wrote (639)	5/24/1998 12:27:00 AM
From: Clam Clam	Read Replies (1) \| Respond to of 1670

"That which doesn't kill you makes you stronger" - nice quote to have on your page. Somehow, I am still net ahead on this stock. I sold some in the high $50's as the position got huge in a hurry and Peoplesoft and Baan didn't have great quarters and a rotation out of software began. That reduced my net cost to about $27 1/4. Oh what could have been though. This one was a shock and I don't yet know what I learned from it other than what I already knew, diversification is the only free lunch there is on Wall Street - especially when you are trading small-cap tech stocks.

To: Big Sky who wrote (639)	5/24/1998 10:35:00 AM
From: Bobo	Read Replies (1) \| Respond to of 1670

Steve, I found your post interesting regarding the DCB and wanted to added a few of my own thoughts that are not as quantitative as yours: - It is helpful to distinguish b/t a short-term, technical DCB and a stock recovering because expectations bottomed and then improved. In the case of RATL, it bounced technically at first (DCB) but now has rebounded b/c expectations are on the rise. - Short-term DCB's are more typical in a market with positive sentiment than in a market with the current poor sentiment. This changes awful fast (as sentiment was great two weeks ago). - My expectations for a company like MANU are that it may realize a short-term DCB but will fade after that since current investors use the opportunity to erase the investment from their memory and analysts are not comfortable in seeing the 12 - 24 mo horizon with positive expectations. I guess mo-mo investors would say that bad stocks get worse before they get better. At the first sign that the company will stabilize, the stock firms up (a). If things improve enough over the next quarter or two (as mgt says they will), investors really see the whole event as "temporary" and bid the stock up (b). It things get worse (let's say thing are worst than mgt communicates), the stocks sees another downleg (c). Good examples of (a) is ORCL over the last 6 mo's, (b) Ascend over the last 9 months and (c) 3com over the last two qtrs. - Looking at these factors with a bias towards long-term investments, I see MANU price as a decent entry point (a 25% position) but expect better prices to arrive in the next few weeks (given that market sentiment looks to be trending down). I would see the low 20's as awful attractive. Just a few thoughts. Bobo