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

To: David W. Ricker who wrote (1642)	7/28/1998 3:21:00 PM
From: dougjn	Respond to of 4509

This decline is starting to get a bit tiresome. I've decided it should end, soon. <gg> Buying time. Doug

To: David W. Ricker who wrote (1642)	7/28/1998 3:40:00 PM
From: Chuzzlewit	Read Replies (4) \| Respond to of 4509

David, I agree with most of what you said. Right now I think we're dealing with a growth perception issue. We were told to expect PSFT growing at roughly 60% per annum going forward rather than the 70% to which we had become accustomed. Apparently companies are putting off installing ERP solutions in favor of quick fixes for the y2k problem. But this cloud has a silver lining. Administrative support for rapidly growing companies can be a real problem. Somewhat more deliberate growth rates can alleviate some of those infrastructural problems. I also have to believe that the corporate buyers are simply delaying the inevitable purchase of software, so we may see a resumption of hypergrowth (not that 60% is anything to sneeze at) in a year or so. I am conservatively estimating earnings at roughly $.84 for the next four quarters, which yields a forward P/E of around 46. This is a considerable discount to the market. PSFTs PEG would be .77 compared to the PEG of the S&P500 of around 2.7. I have come up with a metric normalizing PEGs with respect to the market called CNPEG (Chuzzlewit's Normalized PEG) wherein you divide the PEG of the stock by the PEG for the market. This yields a CNPEG of around 0.3. That tells me that in relation to the rest of the market PSFT is a screaming buy. TTFN, CTC

To: David W. Ricker who wrote (1642)	7/28/1998 4:32:00 PM
From: abhi	Read Replies (1) \| Respond to of 4509

I agree with you in toto. PeopleSoft is a company with strong fundamentals unlike today's Internet companies. I also strongly believe that PSFT is going to do good in the long run. I am also a long-term investor like you and I have total faith in the PSFT stock. Right now, I feel, most of the money is going for Internet Stocks. Why so many people are after Internet Stocks -- difficult to understand. None of the internet companies have shown any profits. It is quite difficult to understand where these internet companies are going to be ten years from now. Today YAHOO's market cap is close to the market cap of PSFT. Can you believe this??? It is ridiculous! Once the investors differentiate right from wrong, good from bad, they'll come back to socks such as PSFT. .. Hope that day is not far enough...

To: David W. Ricker who wrote (1642)	8/1/1998 12:45:00 PM
From: Mixtliman	Respond to of 4509

David, I am sure you are right about PS acquiring other companies. PS has large cash reserves and they will most likely be on a buying spree. What is interesting, though is PS's strategy to incorporate their acquisitions. It is also interesting to contrast PS's strategy against that of SAP and Baan. SAP builds Baan buys and doesn't execute well on the integration PS buys and integrates well. SAP builds everything. They built their own retail solution, middleware, data warehousing tool, and now they are building their supply chain optimization tool, SCOPE. They usually cannot agree with partners on how to partner (for example I2). Also the integration with SAP is horribly complex due to the way they access their database. Building everything seems outmoded, the market wants best of breed. Baan buys. They have bought CODA in financials and Meta4 in HR. However currently their is little to no integration with these products. While CODA is a strong company based in the UK, Meta4 is a crummy HR/Payroll product based in Spain that has not entered the US market yet. Meta4 will have no success their, competing in a mature market. If you look at Boeing, Baan's first major US customer, did Boeing decide to go with Baan for financials and HR? No, actually PS got the business. I think Baan is in for a big fall. PS has great relations with their partners. If you look at Intrepid for example, Intrepid ported their solution to PeopleSoft's development environment before the acquisition was announced. Salerno's manufacturing quality app is already integrated with PeopleSofts environment, and Red Pepper, while not running on the PS development environment, has integration with the PS distribution products, making PS the only major ERP vendor with realtime enterprise planning (Oracle, Baan, SAP do not have a tool, SAP, though is building SCOPE). Who are the acquisition targets of PS? Good question, Seibel is a likely target. But I am sure that PS has many in mind. I think by year end you will see a few acquisitions announced. And I am sure that PeopleSoft will be able to execute better than any other ERP vendor the integration of the acquisitions products with their own.