I feel the numbers are bad and the next two quarters will look weak too on a YoY basis. However, I also feel that (based on guidance), numbers should begin to improve sequentially from here on. If one has a slightly longer term horizon (say 2-3 years) it seems quite interesting.
- Pipeline has held up well; 2) Platform revenue is already higher than license revenue (thus impact of that transition or mix change on growth and margins would be lower in coming years); 3) Growing market segment and Intellect’s product acceptance within it; 4) Margins should pick up as costs woulnt rise in line with revenues.
Although, margins would be volatile becuase being a product company they will have to keep re-investing because if they dont a new competitor will do to them what Temenos did to the likes of OFSS or ThoughtMachine is doing to Temenos. Margins should pick up but improvement should be more gradual and probably settle in mid-20s (thats just my guess) than in 30s.
Thats my read – would request other members to share their thoughts if they have contrasting views.
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