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To: Stitch who wrote (5075)	12/8/1998 5:45:00 PM
From: Gottfried	Read Replies (1) \| Respond to of 9256

Stitch, re >If I were a major H&Q customer I would be PO'd.< Why? Or did you mean "IPO'd"? G.

To: Stitch who wrote (5075)	12/9/1998 7:01:00 AM
From: Mark Oliver	Read Replies (2) \| Respond to of 9256

<Howzit down under?> Getting settled in. Still a little stressful getting adjusted, but definitely an improvement. Took a while to get a good used car, but think we are well set now. Speaking of anal-ysts, I found today's statement from Prudential interesting regarding their opinion of the coming y2k event. As you know, I've questioned this and have rarely gotten any answer from people “in the know”. This is the first statement I have seen with this kind of wording. It's still very slippery as you don't really know what the author is saying, but interesting none the less. Another analyst not worth paying attention to? I liked the H&Q guy by the way because I still hold RDRT shares. :) Regards, Mark Investment Thesis-Summary. We are lowering Check Point shares to Accumulate from Strong Buy and raising our price target to $47 per share. Our revised price target reflects stronger expected earnings in 1999, following discussion with management this evening. The revised price target is based on a 25% discount to pre-tax income growth of 30% that we are projecting for the coming year. The resultant multiple of 22.5X is applied to the revised EPS of $2.08 CY 1999 EPS estimate yielding the $47 figure. We note that CHKPF shares are up 207% from their October 8th low of $13 per share versus 23.7% for the S&P 500 and 29.2% for the Russell 2000. Our First Call note of October 9th highlighted the upside potential for the shares and pointed out that 40% plus growth was certainly reasonable for the coming year. The shares have also enjoyed particular strength over the past three trading sessions, up 25% from $31.50 per share. Our confidence in the company's ability to meet or exceed 45% revenue growth in CY1999 versus 1998 remains high. Looking ahead to CY2000, assuming the company is able to maintain top-line 45% growth, we believe earnings could grow by 40% vs. CY '99 figures to a pro-forma $2.90 per share on 41.6 million shares. Noting the upside of 20% from current levels to our revised target, we are adjusting the rating to "Accumulate" from "Strong Buy" which carries a 25% return. Reiterating Confidence In Company Direction We again wish to reiterate our belief that the company is following an effective direction with regard to growing the business and maximizing revenue and return potential. The addition of a direct sales organization will enable Check Point to more effectively address the managed service provider opportunities that are not conducive to service via two-tier channels. Furthermore, we expect that the pending Y2K event will divide the marketplace into two camps - one paralyzed into waiting for the passage of this event (focused on current projects and freezing all other non-essential expenditures) and a second group of client companies who have completed their Y2K remediation and testing and are proceeding with VPN, Extranet and other E-Commerce affiliated initiatives. Check Point continues to provide one of the most comprehensive, firewall-based, policy management platforms today. Scaleable from the department to the telco network, we believe that CHKPF's single greatest competitor is market readiness and access, not Cisco. While Cisco may be the vendor whom Check Point most often faces, we believe that the marketplace remains highly underdeveloped and clearly under-penetrated. Coppied from the Yahoo thread.