Point Firmly in No Particular Direction

YOU CAN SENSE that things are getting out of hand when the legal disclosure forms now required of stock analysts are longer than the analysis itself. This was what I discovered when I called Stephens Inc., investment bankers in Little Rock, AR, trying to elicit some comments from a research analyst about the quarterly earnings reports issued by supply chain and logistics software companies.

I got Robin Roberts on the phone, and was surprised to discover that she was a woman, not the Hall of Fame pitcher for the Phillies I’d heard about as a child. But I wasn’t able to discover anything more — not right away, anyway — because, she informed me, I needed to give her my fax number so they could send me some legal disclosure forms. I arranged to speak with her later in the day and went out. When I returned, I found the floor littered with 12 — count ’em, 12 — pages of Research Analyst Printed Media Disclosure Forms. And so, when I made the call I felt that somehow Robin Roberts and, indeed, all of Stephens Inc., was now exposed to me, though it was not a video phone connection.

HOPE SPRINGS ETERNAL The reason for my call was that JDA Software, Manhattan Associates, Retek, Vastera, EXE Technologies, and Manugistics (in that order) had all announced their earnings, and I wanted to know What It All Meant: for these particular companies, for the software/supply chain/logistics/fulfillment and retail industries in general, and for the economy as a whole. Yes, perhaps I was being a bit optimistic in my expectations of what a single research analyst in Little Rock could tell me, but then again, hadn’t Little Rock once been home to a man from Hope?

I asked what it all means. And Robin Roberts said, “All of the numbers reported have either met or beaten expectations.” Some of them were better than others, of course — and, let’s not forget, in stock market-speak, “meeting expectations” doesn’t necessarily have anything to do with doing well — but Roberts was blunt: “When you peel off the superficial stuff and look at management’s comments in the [context of the economic] environment, I think the environment is stabilizing; it has not improved, but it is not getting any worse.”

FOR BETTER OR WORSE So, if it’s not any worse, it’s better, right? “IT spending is stabilizing; it’s not any better.” But things are looking up, right? “Manufacturing activity is improving, in terms of inventory to sales, new orders of capital goods, etc. But the job market is still losing positions.” OK … still, if orders are up, things are getting better, aren’t they? “The environment is stabilizing, but nobody is saying the environment is improving.” Then, when will we know if the environment is improving? “I think that most likely, if everybody has a good Christmas season, there will be increased IT budgets for 2004.”

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