Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of business management software developer Pegasystems
So what: Last night's third-quarter report missed every conceivable analyst target, and often by margins you could drive an oil tanker through. The customer management sector looked at Pegasystems' travails and merely shrugged; TIBCO Software
Now what: Management tried to cushion the coming blow to share price by quadrupling the size of its buyback program -- but an extra $15 million authorization hardly makes a difference to a billion dollar market cap. CEO Alan Trefler called the results "lumpy" and stated that his value proposition is "resonating strongly with clients, prospects, and partners." But this sounds like so much hot air -- Pegasystems' results are unpredictable even on a trailing-12-month basis, and the stock still trades at a stunning 200 times trailing earnings. All three of the sector rivals mentioned above look like stronger investments against this questionable backdrop.
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Fool contributor Anders Bylund holds no position in any of the companies mentioned. Motley Fool owns shares of Oracle. Motley Fool newsletter services have recommended buying shares of TIBCO Software, Pegasystems, and salesforce.com, and have also recommended shorting salesforce.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Check out Anders' holdings and bio, or follow him on Twitter and Google+. We have a disclosure policy.