We haven't written a whole lot about little enterprise software maker Progress (NASDAQ:PRGS) in the past, but perhaps we should have.

Since our last report on the company more than a year ago, authored by Foolish colleague and tech expert Tom Taulli, the company has been holding up just fine against the likes of competitors Siebel (NASDAQ:SEBL), Oracle (NASDAQ:ORCL), Sybase (NYSE:SY), and SAP (NYSE:SAP). Back then, Tom was writing about Progress' fiscal third-quarter 2004 performance, in which it achieved 16% earnings growth on 15% growth in revenues. Analysts are expecting the company to report even better results tomorrow; they're looking for a 10% year-over-year improvement in sales and profits improving by nearly twice that, from $0.31 per diluted share in fiscal Q4 2004 to $0.37 in the final fiscal quarter of this year.

Note that analysts express their projections/results in their own secret "pro forma" dialect, which is a distant relative of Sanskrit and equally comprehensible to most investors. In reality, under generally accepted accounting principles (GAAP), Progress earned only $0.28 per diluted share in net profits in the year-ago quarter and will, accordingly, likely report far less than $0.37 in net profits tomorrow (the firm itself projects $0.31 to $0.32 net).

Similarly, the firm's $0.82 in net profits per diluted share for the full fiscal year 2004 translated into $0.99 per share in pro forma-speak. (In case you forgot, that's the language Wall Street will be speaking in when it decides whether Progress hit or missed the targeted $1.33 in full fiscal year pro forma profits tomorrow.)

Confused yet? Then let us free you of the chaos. Ignore the analysts. Ignore the pro forma-speak. Focus on the cash. So far this fiscal year, Progress has generated $58 million in free cash flow. That's a 17% improvement over last year's $49.5 million. It's also a good 66% higher than the $34.9 million GAAP permits the firm to report as its net profits. On a run-rate basis, we'd therefore expect Progress to close out its fiscal year by reporting approximately $77 million in total free cash flow for the year tomorrow.

If it can accomplish that feat, Progress will have a price-to-free cash flow ratio of 16, which, compared to its return on equity of 15%, makes the firm look, at best, fairly priced. Consider, however, that Progress also has a quarter of a million dollars in the bank, so fully 20% of its market cap is backed by cold, hard cash.

In this Fool's book, that would make Progress a "buy."

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Fool contributor Rich Smith does not own shares of any company named above.