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The just-reported second quarter saw sales of $142.7 million and GAAP earnings of $0.06 per diluted share. Adjusting for currency changes, that's 1% of year-over-year revenue growth and triple the net income per share.
TIBCO closed 11 million-dollar contract deals this quarter, following 11 such megadeals last quarter and only seven a year ago. Seventy-seven closings in the $100,000 to $1 million range improved considerably on last quarter's 55 midsized signings and stayed close to the year-ago quarter's 84 such deals. New customers include massive operations like energy giant Chevron (NYSE: CVX ) and Liberty Media Interactive's (Nasdaq: LINTA ) QVC home shopping network.
With surging earnings, hefty free cash flows, and even growing sales, TIBCO is looking like a poster child for economic recovery. But don't forget that the company also sits at the crossroads of cloud computing and enterprise software, poised to bridge the gap between corporate computing needs and the benefits of the networked data cloud.
In a recent interview with Forbes, CEO Vivek Ranadive explained that he sees traditional enterprise applications like databases and single-server data crunching falling by the wayside. He believes that cloud-based software models are becoming the norm, putting forerunners in that sector at a distinct advantage going forward. Besides his own company, Ranadive thinks that IBM (NYSE: IBM ) and Amazon (Nasdaq: AMZN ) are looking good in today's rapidly changing IT environment, while Microsoft (Nasdaq: MSFT ) and Oracle (Nasdaq: ORCL ) are looking vulnerable. And I'd concur with all of those judgments.
Like the rest of the market, TIBCO's stock fell hard last year, presumably on fears that corporations would stop buying enterprise software. That's clearly a short-term concern, and I'm a long-term investor with a strong conviction that TIBCO's top-notch products, unique market position, and strong balance sheet would see the company through this temporary turbulence.
Now TIBCO has proven me right, but I never acted on my research. I'm kicking myself for not buying some TIBCO stock while it was cheap. Still, I don't think that a price-to-earnings ratio in the low 20s is outrageous for such a well-positioned company in a rapidly recovering sector.
Remind me when our Foolish disclosure policy will let me buy TIBCO again. I just might get it done this time.