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Technology Stocks : Seagate Technology -- Ignore unavailable to you. Want to Upgrade?

To: William Epstein who wrote (6402)	12/11/1998 4:52:00 PM
From: William Epstein	Read Replies (1) \| Respond to of 7841

heirtag; I think your on the right side of the options game, at the moment. Although, we all, on this SI, want to avoid bringing in extraneous events so that we can remain focused the impeachment proceedings can no longer ignored. I have noticed that the market started going down,as soon as, the elections were over and these hearings resumed in earnest. I believe, that no one one the floor nor investors themselves wish to admit the depressing effect that these hearings are having on the market for fear of making it worse than it is. The last several years, if memory serves, the market has been up around Christmas time, despite all kinds of things and events. The difference this year is that impeachment, even frivolous impeachment is very serious and a lot more serious than we collectively wish to recognize but it is showing anyway. The stupidity in Congress is beginning to permeate everything, everywhere. Its a safe bet that the market will continue to go down, maybe for several months. By the way, in listening to the arguments I was struck by how lousy this group of lawyers really is. I wouldn't pick any of them to represent me for a traffic ticket. Now I know why they are there. They can't make it on the outside where all the other lawyers are. PHOTOMAN

To: William Epstein who wrote (6402)	12/11/1998 5:03:00 PM
From: Gus	Read Replies (1) \| Respond to of 7841

Can anybody say EBIDTA? From a 11/11/98 Briefing report on VRTS' presentation at AEA.... briefing.com VERITAS (VRTS) ....Presentation focused on the recent acquisition of Seagate Software Network and Storage Management Group, a division of Seagate (SEG). On top of the recent acquition of TeleBackup, the company became one of the world's top ten software company. The strategy is to build a complete suite of products for everything related to storage management for large networks: backup, clustering, redundant application distribution, management. Key to the acquisition is how Seagate strengthens Veritas distribution channels, and gives them a presence in all channels now: direct, OEM, and VAR. Focusing on increased channel strength is well received by analysts. Combined company should show a pro-forma revenue of $600 million in 98. Current trailing twelve months (TTM) is $364. Projected pro-forma combined earnings are $90 million, current TTM earnings are $85 million. Projected revenue growth is 50% annually, a little hard for us to accept, but no one seemed to question it. Overall financials for the company do look good. Gross margin is 88%, operating income is 8%. All other segments are already at the company targets. Briefing's biggest concern is the write off for this acquisition. $400 million immediately, and then $60 million every quarter for the next two years. The street will ignore it, probably, as long as cash flow is positive, but two years is a long time. Veritas will now report two sets of numbers for what will seem to be forever. The key thing to watch, if Veritas ever misses its number, will be cash flow, but since that isn't reported in press releases, you'll have to calculate it. But if revenue really does grow at 50%, it won't matter. There will be plenty of free cash. In summary, a real sign of the consolidation of the software industry, and why it will probably happen with more segments. Now the customers just have to come through with purchase orders.