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Technology Stocks : OBJECT DESIGN Inc.: Bargain of the year!! -- Ignore unavailable to you. Want to Upgrade?

To: Edward F. Horst Jr. who wrote (2429)	10/22/1998 3:09:00 PM
From: Punko	Read Replies (2) \| Respond to of 3194

Wall St is waiting for ODI and its target market demonstrate the kind of growth that would justify the PE and risk. The conventional wisdom is that "ODBMS is a niche market and will remain so well into the foreseeable future". Until ODI puts together a few 50%-100%+ quarters, that perception will stand. And the multiples that investors are willing to pay for ODI will continue to erode as their patience or enthusiasm regarding the company's prospects give way to more tempered, realistic outlooks based on past performance. THe stock will wallow until these multiples converge with realistic growth rates, which may happen some time middle of next year, imo. And that's when the stock will start showing some serious appreciation, unless ODI delivers a positive earnings discontinuity before then, which given the history, I sort of doubt will happen. When Oracle, Informix, and the rest of the so-called dinosaurs were the size of ODI, they put up those kinds of numbers. What's more, they continued to grow at those clips well beyond the $1B/yr milestones. And they were correspondingly rewarded. With ODI, you have a (still :-( ) small company with promising technology and promising markets, but little in the way of a track record. After all this time, Wall St has every right to demand numbers that justify the still-high PE. And if Yahoo and the rest of those internet stocks on crack don't show astronomical growth numbers to justify their outrageous valuations, they'll come crashing down too. I've hung on to ODI for some time because I've been expecting a discontinuity based on my belief that they're building a strong sales team. Unfortunately, the spike I'm waiting for has not come. Now I'm just hoping that they can keep up their current respectable albeit unspectacular growth long enough for that convergence to occur soon and the stock to begin showing 15 to 20% annual appreciation over a long term period.