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Did you ever wonder what those big institutional hedge fund and money managers do all day? They sit up there on their fat asses and try to make a market call and then they get all nervous when the market moves against them and then they sell. They’d be really happy if no one knew about their idiotic mistake and their more idiotic cowardly exit. The bad news for them is that there is very good software out there that tracks all this stuff. SS&C Technologies is an IT company that helps money makers make money. If they were smart they would just tell their clients to trust MM and follow his teachings. 35% year over year returns for a decade make MM the Warren Buffet of the 21st Century.
Today I bought SSNC at 44.40. I will sell it in 4 to 6 weeks at 51.22. Here’s why I like SSNC:
SSNC stock is up 352% in the last 12 months. That’s almost 1% per day. Yeeee hAAAA….that’s some bad ass momentum. All I humbly ask for is another 15%. True.. its PE multiple is up there at 49, but at this kind of momentum it’s hard for the earnings to keep up since they only get reported every 3 months. This is not vaporware….SSNC is a legitimate business with established sales and earnings. Either way, they don’t report until April, and I’m sure I’ll be long gone on this baby by then.
SS&C is a leading provider of application software for the commercial lending industry and real estate property managers. SS&C is a world wide leader delivering value-driven solutions to the financial institution marketplace. Currently used by nearly 2,000 financial institutions, these Internet-based financial information tools help regional banks, community banks, credit unions and other financial institutions effectively measure, analyze, and manage balance sheets and investment portfolios. SS&C's investment management solutions deliver integrated multi-currency portfolio management, financial and partnership accounting functionality while addressing the hedge and private wealth fund requirements for handling complex securities, sophisticated investment strategies, multi-tiered ownership structures, global investments, and increasing regulatory demands that characterize this market. SS&C is a leading supplier of technology solutions and services to the insurance industry. Their 500-plus global insurance client base includes many of the largest and most prestigious name in the industry. SS&C is the leading provider of financial software for fixed income analysis in municipal finance. Approximately 75% of all annual negotiated new issuances of municipal bonds are structured using our DBC software. DBC products are widely used for structuring general obligation and revenue bond issues, including asset-backed housing and student loan securitizations.
SSNC’s customers are all monkey see monkey do. That’s how SAP became so popular. All the CEO’s will go to cocktail parties and they’ll hoist their martinis and say, “We have all the new SS&C Technologies software. You? YOU? YOU!!!???”. Then the other CEO’s are all faceful and they run out and buy the software even though they don’t know what it is. SSNC’s COO paints a clearer picture, “Our sales strategy is simply that our products work. By pointing out the functional strengths of our software, we have been able to post a number of substantial wins and take clients away from competitors."
SSNC also makes Advisorware: AdvisorWare supports investment firms with sophisticated global investment, trading and management concerns, and/or complex financial, tax, partnership, and allocation reporting requirements. It delivers comprehensive multi-currency investment management, financial, contact management and partnership accounting in a Straight-Through Processing (STP) environment. Sorry, but what it does not do is teach these bozos how to pick stocks. Only $$$MR. MARKET$$$ is the best stock picker on the planet, and I’m going to stay that way. Clients were using the company's products to manage in the aggregate over $4 trillion in assets as of year-end 2002. You think they could find a way to send some of that rounding error over my way? Remember in Superman 3 when Richard Prior was a computer programmer and he figured out a way to have all the pennies that were rounded off in people’s paychecks transferred to his bank account?
So how does SSNC turn this expertise into cold hard cash? Let’s take a look at how they are doing, shall we? In the last two years, revenues have grown about 10% per year to $65 million. Now this isn’t that great, but their real earnings come from the service that they provide, creating a renewable revenue stream. The company offers a range of professional services to assist clients in implementing its software products, including the initial installation of the system, conversion of historical data, and ongoing training and support. SSNC's consulting team works closely with the client to ensure smooth transition and operation of SSNC's systems. “What’s that Mr. Blowhard? You can’t figure out how your trading system works? No problem, we’ll be right out to your office. Would you mind signing this invoice first?” SSNC provides each of its significant clients with a dedicated client support team whose primary responsibility is to resolve questions and concerns. Direct telephone support is provided during extended business hours, and additional hours are available during peak periods. Next thing you know, there is a SSNC employee with an office on site who spends all day in the men’s room looking at spank magazines.
Get the picture? While their revenues have only grown at a 10% clip, earnings over the same period expanded by 115% per year. How can this happen?? Gross margins are 73%....73%!!! So almost all of every incremental buck that they make is headed right for the bottom line.
$$$MR. MARKET$$$ expects this awesome value added service to customers to continue. I almost pissed my pants when I saw that ANALysts have pegged SSNC to net $1.10/share for 2004. Baa haa haa! Are you KIDDING ME??? $$$MR. MARKET$$$ sees 2004 revenues at $80 million and this will allow them to pocket $1.35/share. At today’s P/E of 49, this translates to a stock price of $66.15, which is well past my sell target.
SSNC’s machine is running at a solid 20.5% ROE vs. the industry ROE of 13.6%. They have no LT Debt, funding all of their R&D with cash flow. This shows management confidence in the quality of their earnings since they can’t afford to choke off their life blood which is their R&D. These guys are so cocky about their cash flow, they even started paying a dividend!
Last week they announced a 3 for 2 stock split. Then they pay a cash dividend on top of that. More and more quatloops. This is insane! Here’s what the boss says. SS&C Chairman and CEO Bill Stone commented, "The Board's decision to approve this stock split is in response to our solid financial performance, our strong balance sheet and the increase in the market price for the Company's common stock. The split will reduce the price per share and is intended to broaden the stockholder base and increase the availability of shares for trading. The cash dividend, which we instituted last August, will be reviewed later this year to ensure we are paying out an appropriate percentage of our earnings." This guy owns 36% of the stock, so paying a dividend is a good way for him to take a payday.
He also said, “The strength of our management team, outstanding execution of our business plan and steadfast focus on our goals have helped us produce these strong results. We increased profits during each quarter of 2003, grew operating costs in check and broadened our market position and client base. In Q4, we hit another record high with our operating income at $6.0 million, up 31% from the record high of $4.6 million reached in Q3 '03 and up 50% over Q4 '02. Operating income for the year 2003 was $18.4 million, up 65% from $11.1 million in 2002. We continued to improve our recurring revenues with solid gains in outsourcing revenues. In Q4, outsourcing revenues were $3.6 million, a 21% increase over the $3.0 million posted in Q4 of 2002." SS&C has exceptional financial strength," said Stone. "We ended the year with a strong balance sheet, with $52.4 million in cash and marketable securities, and no debt. For the year, 2003 operating cash flow was $23.7 million, an increase of $8.2 million, or 53% over 2002." Wow..with this much success, maybe Bill Stone could be married to Sharon Stone, then maybe he would sleep later in the morning.
Last July, this is what he said, “"At present, we expect Q3 2003 revenues to be in the range of $16 to $17 million and net income to be between $0.21 and $0.24 per diluted share," stated Stone. "For the full year 2003, our expectation is for revenue to be $65 to $68 million and we anticipate diluted earnings per share to be between $0.81 and $0.86." See? He was right on the money and even outdid his prediction. In this growing economy, with the market picking up, and Greenie being nice to us, the financial community is going to spend spend spend on software! There is no question whatsoever that they will beat their projected 2004 numbers quite handily.
The best thing about SSNC is that they are located in Windsor, Connecticut. I destroyed millions of brains cells near there back in the early 80’s. Such forgettable watering holes such as the Bridges Inn, Katies Café, the Pumpernickel Pub and the I-190 were often frequented by a young $$$MR. MARKET$$$, in his futile attempt to convince fair lasses that, one day, he would be the best stock picker on the planet. Alas, all they saw was some lunkhead with 19” biceps sucking on Heineken bottles like he was trying out for the Varsity La Leche League team. Poor $$$MR. MARKET$$$ would go home licking his wounds. If they only knew….
Today I bought SSNC at 44.40. I will sell it in 4 to 6 weeks at 51.22. Here’s why I like SSNC:
SSNC stock is up 352% in the last 12 months. That’s almost 1% per day. Yeeee hAAAA….that’s some bad ass momentum. All I humbly ask for is another 15%. True.. its PE multiple is up there at 49, but at this kind of momentum it’s hard for the earnings to keep up since they only get reported every 3 months. This is not vaporware….SSNC is a legitimate business with established sales and earnings. Either way, they don’t report until April, and I’m sure I’ll be long gone on this baby by then.
SS&C is a leading provider of application software for the commercial lending industry and real estate property managers. SS&C is a world wide leader delivering value-driven solutions to the financial institution marketplace. Currently used by nearly 2,000 financial institutions, these Internet-based financial information tools help regional banks, community banks, credit unions and other financial institutions effectively measure, analyze, and manage balance sheets and investment portfolios. SS&C's investment management solutions deliver integrated multi-currency portfolio management, financial and partnership accounting functionality while addressing the hedge and private wealth fund requirements for handling complex securities, sophisticated investment strategies, multi-tiered ownership structures, global investments, and increasing regulatory demands that characterize this market. SS&C is a leading supplier of technology solutions and services to the insurance industry. Their 500-plus global insurance client base includes many of the largest and most prestigious name in the industry. SS&C is the leading provider of financial software for fixed income analysis in municipal finance. Approximately 75% of all annual negotiated new issuances of municipal bonds are structured using our DBC software. DBC products are widely used for structuring general obligation and revenue bond issues, including asset-backed housing and student loan securitizations.
SSNC’s customers are all monkey see monkey do. That’s how SAP became so popular. All the CEO’s will go to cocktail parties and they’ll hoist their martinis and say, “We have all the new SS&C Technologies software. You? YOU? YOU!!!???”. Then the other CEO’s are all faceful and they run out and buy the software even though they don’t know what it is. SSNC’s COO paints a clearer picture, “Our sales strategy is simply that our products work. By pointing out the functional strengths of our software, we have been able to post a number of substantial wins and take clients away from competitors."
SSNC also makes Advisorware: AdvisorWare supports investment firms with sophisticated global investment, trading and management concerns, and/or complex financial, tax, partnership, and allocation reporting requirements. It delivers comprehensive multi-currency investment management, financial, contact management and partnership accounting in a Straight-Through Processing (STP) environment. Sorry, but what it does not do is teach these bozos how to pick stocks. Only $$$MR. MARKET$$$ is the best stock picker on the planet, and I’m going to stay that way. Clients were using the company's products to manage in the aggregate over $4 trillion in assets as of year-end 2002. You think they could find a way to send some of that rounding error over my way? Remember in Superman 3 when Richard Prior was a computer programmer and he figured out a way to have all the pennies that were rounded off in people’s paychecks transferred to his bank account?
So how does SSNC turn this expertise into cold hard cash? Let’s take a look at how they are doing, shall we? In the last two years, revenues have grown about 10% per year to $65 million. Now this isn’t that great, but their real earnings come from the service that they provide, creating a renewable revenue stream. The company offers a range of professional services to assist clients in implementing its software products, including the initial installation of the system, conversion of historical data, and ongoing training and support. SSNC's consulting team works closely with the client to ensure smooth transition and operation of SSNC's systems. “What’s that Mr. Blowhard? You can’t figure out how your trading system works? No problem, we’ll be right out to your office. Would you mind signing this invoice first?” SSNC provides each of its significant clients with a dedicated client support team whose primary responsibility is to resolve questions and concerns. Direct telephone support is provided during extended business hours, and additional hours are available during peak periods. Next thing you know, there is a SSNC employee with an office on site who spends all day in the men’s room looking at spank magazines.
Get the picture? While their revenues have only grown at a 10% clip, earnings over the same period expanded by 115% per year. How can this happen?? Gross margins are 73%....73%!!! So almost all of every incremental buck that they make is headed right for the bottom line.
$$$MR. MARKET$$$ expects this awesome value added service to customers to continue. I almost pissed my pants when I saw that ANALysts have pegged SSNC to net $1.10/share for 2004. Baa haa haa! Are you KIDDING ME??? $$$MR. MARKET$$$ sees 2004 revenues at $80 million and this will allow them to pocket $1.35/share. At today’s P/E of 49, this translates to a stock price of $66.15, which is well past my sell target.
SSNC’s machine is running at a solid 20.5% ROE vs. the industry ROE of 13.6%. They have no LT Debt, funding all of their R&D with cash flow. This shows management confidence in the quality of their earnings since they can’t afford to choke off their life blood which is their R&D. These guys are so cocky about their cash flow, they even started paying a dividend!
Last week they announced a 3 for 2 stock split. Then they pay a cash dividend on top of that. More and more quatloops. This is insane! Here’s what the boss says. SS&C Chairman and CEO Bill Stone commented, "The Board's decision to approve this stock split is in response to our solid financial performance, our strong balance sheet and the increase in the market price for the Company's common stock. The split will reduce the price per share and is intended to broaden the stockholder base and increase the availability of shares for trading. The cash dividend, which we instituted last August, will be reviewed later this year to ensure we are paying out an appropriate percentage of our earnings." This guy owns 36% of the stock, so paying a dividend is a good way for him to take a payday.
He also said, “The strength of our management team, outstanding execution of our business plan and steadfast focus on our goals have helped us produce these strong results. We increased profits during each quarter of 2003, grew operating costs in check and broadened our market position and client base. In Q4, we hit another record high with our operating income at $6.0 million, up 31% from the record high of $4.6 million reached in Q3 '03 and up 50% over Q4 '02. Operating income for the year 2003 was $18.4 million, up 65% from $11.1 million in 2002. We continued to improve our recurring revenues with solid gains in outsourcing revenues. In Q4, outsourcing revenues were $3.6 million, a 21% increase over the $3.0 million posted in Q4 of 2002." SS&C has exceptional financial strength," said Stone. "We ended the year with a strong balance sheet, with $52.4 million in cash and marketable securities, and no debt. For the year, 2003 operating cash flow was $23.7 million, an increase of $8.2 million, or 53% over 2002." Wow..with this much success, maybe Bill Stone could be married to Sharon Stone, then maybe he would sleep later in the morning.
Last July, this is what he said, “"At present, we expect Q3 2003 revenues to be in the range of $16 to $17 million and net income to be between $0.21 and $0.24 per diluted share," stated Stone. "For the full year 2003, our expectation is for revenue to be $65 to $68 million and we anticipate diluted earnings per share to be between $0.81 and $0.86." See? He was right on the money and even outdid his prediction. In this growing economy, with the market picking up, and Greenie being nice to us, the financial community is going to spend spend spend on software! There is no question whatsoever that they will beat their projected 2004 numbers quite handily.
The best thing about SSNC is that they are located in Windsor, Connecticut. I destroyed millions of brains cells near there back in the early 80’s. Such forgettable watering holes such as the Bridges Inn, Katies Café, the Pumpernickel Pub and the I-190 were often frequented by a young $$$MR. MARKET$$$, in his futile attempt to convince fair lasses that, one day, he would be the best stock picker on the planet. Alas, all they saw was some lunkhead with 19” biceps sucking on Heineken bottles like he was trying out for the Varsity La Leche League team. Poor $$$MR. MARKET$$$ would go home licking his wounds. If they only knew….
He sold this beautifull stock for nice 16% profit. Your Hugeness rocks again! Thanks, Ton
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