Friday, October 12, 2007

Tiptoeing around TIBCO

With Oracle's bid for BEAS, the question on traders mind is: Who is next? Take a look at Tibco Software (TIBX 8.77), which traded up a buck today, on 10 million shares. Tibco recently bought Spotfire, which integrates your data by moving a slider across the screen, and you "see" the data. Software companies call it "interactive information visualization." Compare this to how traders look at charts, and manipulate the data, and see the results in front of you. It's intuitive and understandable, and you can "read" the data by the charts. Compare this to an excel spreadsheet full of stock quotes. Which would you prefer?

But nobody cares about TIBX. It's been a rumoured takeover target as long as BEAS. But things changed last week when SAP bought Business Objects, and today when Oracle bid for BEAS. Now analysts are speculating that Hewlett Packard will make a counter bid. Does that make sense? HPQ bidding against Ellison? What did they do, read The Art of War and get courageous? Give me a break. Larry Ellison beat the Justice Department when he acquired PeopleSoft. BEAS will go to Oracle. But Larry doesn't care about HPQ, he wants Oracle to upseat IBM as the No. 2 player in the middleware market, and that market is now being forced to operate in Internet time. And that's forcing IBM's and Hewlett's hand, as both SAP and ORCL have already announced acquisitions so now they're at the dance without a partner.

Ever go to a dance, and have a bit of a buzz, when it's getting late at night? Chances are, your first choice is already gone, but you're not thinking about the one that got away. You're thinking about who's left. And now that farm girl, TIBX, is looking like Erin Burnett of CNBC. So ask her to the dance and get out the ukulele, just so I can throw in another "Oracle."

On Wall Street the most famous ukulele player is the "Oracle from Omaha" Warren E. Buffett, but off of Wall and Broad it's still Tiny Tim, and his Tip Toe through the Tulips tune. Now Tiny Tim shared the same name with Tiny Tim Cratchit of Dickens' A Christmas Carol, and God Bless Tiny Tim was the title of his famous first album, and also the famous last sentence of Dickens' book.

But TibCo knows that they are cheap. They've bought back 25 million shares at an average price of $8.88. Someone else thinks they are cheap and it's secretive Bruce Sherman, of Private Capital Management, at 8889 Pelican Bay in Naples who at last count had bought over 15 million shares of TIBX. Haven't heard of him? Maybe you should. His firm owned over 41 million shares of BEAS!

Does Bruce play the ukulele also? No, but he's great at spotting value, and he sells to the ukulele player, Warren Buffett, who picked up Dairy Queen, Shaw Industries, and Garan clothing, companies he had substantial positions in.

Did IBM invent the ukulele? No, but the ukulele was first plucked in Hawaii in 1885, the same year that the first computing scale was patented by Pitrap, the predecessor company of IBM. And Tibco's name came from the initials of The Information Bus Company, just like IBM's came from International Business Machines.

So I threw in some numerology, history, literature and pop culture, with six degrees of separation from those in the world of money, along with real reasons to buy the stock. And I'll also throw in a November 10 call option at .15 for those who don't have much money, but would like to make it.

And hopefully, we'll be able to say "God Bless you Tiny Tim" when the big elephants come to the dance.

No comments: