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Technology Stocks : FirstWave Technologies (FSTW) -- Ignore unavailable to you. Want to Upgrade?

To: Doug Fowler who wrote (155)	8/5/1998 7:14:00 PM
From: Roger A. Babb	Read Replies (3) \| Respond to of 9677

Doug, FSTW has dropped more than the market but it is thinly traded and dropped on low volume. Does not take much to move it in either direction. I have been accumulating shares but stopped until I see what this crazy market is going to do, shifted my attention to shorting some other stocks. As for the FSTW story, I am very confident in the NetGain product from a technical point of view. I have seen it and it is a great product. But other than for techies like me, investors are not interested in product quality, they focus on revenues. To move ahead FSTW must demonstrate success in the market place with NetGain. While I am acquainted with the marketing management and believe that they will succeed, it is obvious that investors are not accepting that as a given and are waiting for proof in the form of announced deals or increased revenues. We techies tend to believe that if you build a better mousetrap the world will beat a path to your door. In the real world the great marketing guy with the just adequate mousetrap may win. FSTW definitely has a better mousetrap (SFA program) than the competition such as SEBL. Now we find out about the marketing. I see these potential outcomes for FSTW: 1. NetGain is a marketing success, $20+ is possible. 2. NetGain is a technical success but not marketed well. Then a buyout by a larger player is likely, I would guess $10 to $15. 3. NetGain is a flop. We stay in the $3 to $5 range. 4. Netgain is a small success. I would guess $5 to $10 range. But I consider this a very unlikely outcome, products usually do not "win small". Assigning my probability to each of the outcomes (30/30/30/10), I come up with a valuation of about $10 given what I know about the company now. And very little downside from the $4 level.