As the hot public offerings from the likes of athenahealth
Saba develops software to help improve employee productivity and education, and its client list includes such big names as Dell
Keep in mind that Saba wants to pursue both traditional software solutions and on-demand ones. That might cause complications and confusion, because traversing both routes will necessitate managing different code bases and business models. And for a small company -- Saba has only about $11.8 million in the bank -- it could also mean a drain on precious resources.
So even though the Street seems to love the on-demand trend, it sees the potential for problems here. Despite the recent tech rally, Saba's stock has fallen by more than 20% since May, and it's unclear when the company will make a turnaround. On the earnings conference call, management indicated that the recovery could take "three to four years." If so, it's probably best to pass on this stock for now.
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