Friday, October 14, 2005

Recommending the acquirers - II

In an earlier post, I had recommended some acquirers as good long-term investments.

I would like to add BEA (BEAS) to that list. They have gone on a somewhat less attention-grabbing spree of buyouts compared to others. But the quality of the buys has been good so far. The targets include Plumtree, M7 and ConnecTerra.

BEA has still work to do on its app-server. Every release seems to improve a few things drastically, but some things get worse! Take, for example, Weblogic 9.0. Reliability and speed seem to have been improved upon, but the administration console for its app-server is still confusing. I still think that Weblogic can survive and indeed thrive, as a small footprint, nimble alternative to IBM's WebSphere. At the same time, BEA needs to make available value-add products/solutions on top of its application server. To that end, it should now go after a content management system vendor, perhaps Stellent (STEL).

BEA shares are not a bargain, unlike say Oracle, EMC or Macrovision. But they are at a price where you can open a position, with plans to add more later.


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