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

To: LLCoolG who wrote (1398)	7/9/1998 4:51:00 AM
From: Rick	Read Replies (1) \| Respond to of 4509

I agree that companies have great latitude in the numbers that are reported. Clearly, you wouldn't see situations like Informix, Oracle (way back), Cendant, or Sunbeam debacles if accounting were a straight-forward, black-and-white process. Honest companies keep the "manipulation" reasonable, but anyone that thinks they don't manipulate is not alert to reality. Also, there are certainly times when it makes sense to manipulate the numbers down: 1) smoothing the earnings picture from quarter to quarter to give the appearance of a more stable, predictible earnings growth. Wall Street pays for stability and predictibility. 2) setting employee options incentives and you want to target a certain level of gains for options. If the market has bid the stock too high, this can make the projections more difficult. Certainly most companies don't have the luxury of manipulating down due to excessive expectations and pressure. I think PeopleSoft is different - they do a good job of managing expectations even as they grow rapidly. It's just amazing how quickly sentiment changes. The nerves due to last quarter's number were based on everything except specific PeopleSoft business facts. Can you say "short squeeze" ? Rick.