Software Equity Group Flash Reportsoftwareequity.com/Reports/Monthly/2011/SEG...track record,...

Public SaaS CompaniesPublic Internet Companies By Product Category

August 2011

Software Equity Group Flash Report

Select M&A Transactionsand

Financial and Stock Market PerformancePublic Software Companies By Product Category

[email protected]

Copyright © 2011 by Software Equity Group, L.L.C., All Rights Reserved

San Diego, CA 9213012220 El Camino Real, #320Software Equity Group, L.L.C.

p: (858) 509-2800f: (858) 509-2818

http://www.softwareequity.com/index.aspx

mailto: [email protected]

ABOUT OUR FIRM

Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. Founded in 1992, our firm has represented and guided private companies throughout the United States and Canada, as well as Europe, Asia Pacific, Africa and Israel. We have advised public companies listed on the NASDAQ, NYSE, American, Toronto, London and Euronext exchanges. Software Equity Group also represents several of the world's leading private equity firms. We were recently ranked among the top ten investment banks worldwide for application software mergers and acquisitions.

Our value proposition is unique and compelling. We are skilled and accomplished investment bankers with extraordinary software, internet and technology domainexpertise. Our industry knowledge and experience span virtually every software product category, technology, market and delivery model, including Software-as-a Service (Saas), software on-demand and perpetual license. We have profound understanding of software company finances, operations and valuation. We monitor and analyze every publicly disclosed software M&A transaction, as well as the market, economy and technology trends that impact these deals. We're formidable negotiators and savvy dealmakers who facilitate strategic combinations that enhance shareholder value.

THE SEG SOFTWARE COMPANY MENTORING PROGRAM

As part of our informal mentoring program, we are currently guiding and advising some fifty software companies around the globe that are not yet exit candidates, but aspire to be in the next few years. We meet with them periodically, invite them to call whenever they’d like our opinion on an operational issue that might have exit implications later on, and we keep h i d f M&A i i d fi i i h i d A d h b d ’ h f hi i d i I ’ li I ’ f b ildi


them apprised of M&A activity and financings in their product category. And the best news – we don’t charge for this mentoring advice. It’s complimentary. It’s our way of building value, and relationships.

We’re looking for a few more such relationships. We begin with an introductory phone call with companies interested in being mentored, followed by a more in-depth telephone conversation. We’ll then invite qualified candidates to meet personally with four or five members of our team at our San Diego office. During this three to four hour sit-down, we’ll discuss the current market, specifically as it relates to valuations, transactions and trends in your product category. We’ll assess the strengths and weakness of your financial performance, how that compares to other software companies your size, and how that relates to buyer expectations. We’ll discuss your market strategy, sales strategy, sales team track record, software and maintenance pricing strategies, equity structure, and a wide array of other factors that can materially impact your salability and valuation down the road. We’re a terrific sounding board. We’ll give you an informed, honest and frank opinion – that’s what we’re known for. And we’ll offer informed and insightful observations, ideas and options based on 17 years of working with countless software companies worldwide.

If you run a profitable software company with revenue in excess of $10 million, and you’re interested in learning more about SEG’s complimentary, no obligation mentoring program, .2800-509-858or [email protected] contact Kris Beible at

ADDITIONAL RESEARCH

http://www.softwareequity.com/research_quarterly_reports.aspx, please visit: 03Q1For our complimentary current and archived Quarterly Reports from

http://www.softwareequity.com/research_flash_reports.aspx, please visit: 2008For our complimentary current and archived Monthly Flash Reports from July

http://www.softwareequity.com/research_annual_reports.aspx, please visit: 2010through 2003 For our Annual Reports from

mailto:[email protected]

http://www.softwareequity.com/research_quarterly_reports.aspx

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CAD Computer-aided DesignCAM Computer-aided ManufacturingCRM Customer Relationship ManagementEBITDA Earnings before Interest, Taxes, Depreciation, and AmortizationEV Enterprise ValueFCF Free Cash FlowFORWARD Current EV / Next Four Quarters' Consensus Financial EstimatesHR Human ResourcesNASDAQ National Association of Securities Dealers Automated Quotation System

List of Commonly Used Acronyms

NASDAQ National Association of Securities Dealers Automated Quotation SystemOS Operating SystemPLM Product Lifecycle ManagementR&D Research and DevelopmentS&P Standard & Poor'sSaaS Software-as-a-ServiceSEG Software Equity GroupSG&A Selling, General, & AdministrativeSW SoftwareTTM Trailing Twelve MonthYoY Year-over-YearYTD Year-to-date


July 2011

Select Software Industry M&A Transactions


Select July 2011 Software Industry M&A TransactionsDate

Announced EV/ Revenue

07/29/2011 Nimsoft, Inc. Watchmouse B.V. - - -07/29/2011 RealPage, Inc. (NasdaqGS:RP) Senior-Living.com, Inc. $1.0 $14.8 14.8x07/28/2011 Arbitron Inc. (NYSE:ARB) Arbitron Mobile - $23.7 -07/28/2011 Oracle Corporation (NasdaqGS:ORCL) InQuira, Inc. $45.0 $230.0 5.1x07/26/2011 ACI Worldwide, Inc. (NasdaqGS:ACIW) S1 Corporation (NasdaqGS:SONE) $227.3 $436.0 1.9x07/26/2011 Amazon.com Inc. (NasdaqGS:AMZN) Push Button Holdings Ltd. - - -07/26/2011 CCH Incorporated SpeedTax, Inc. - - -07/26/2011 IHS Inc. (NYSE:IHS) Seismic Micro-Technology, Inc. - $500.0 -07/26/2011 Retalix Ltd. (TASE:RTLX) MTXEPS, Inc. - $25.0 -07/25/2011 QUALCOMM Incorporated (NasdaqGS:QCOM) GestureTek, Inc., Certain Assets - - -07/22/2011 Google Inc. (NasdaqGS:GOOG) Pittsburgh Pattern Recognition - - -07/21/2011 Acer Inc. (TSEC:2353) iGware Inc. - $395.0 -07/21/2011 Oracle Corporation (NasdaqGS:ORCL) Ksplice, Inc. - - -07/20/2011 Google Inc. (NasdaqGS:GOOG) Inflatable Spaces Inc - - -07/19/2011 Autodesk, Inc. (NasdaqGS:ADSK) Code Mine in Stockholm AB - - -07/19/2011 LogMeIn, Inc. (NasdaqGS:LOGM) Connected Environments Ltd. - $15.2 -07/19/2011 Neowiz Corp. (KOSE:A042420) NEOWIZ Games Corporation (KOSE:A095660) $481.6 $1,191.0 2.5x07/19/2011 Quepasa Corp. (AMEX:QPSA) Insider Guides, Inc. $23.7 $100.0 4.2x07/19/2011 Riverbed Technology, Inc. (NasdaqGS:RVBD) Zeus Technology Limited - $140.0 7.5x07/18/2011 3D Systems Corp. (NYSE:DDD) Alibre, Inc. - $3.7 -07/18/2011 Move, Inc. (NasdaqGS:MOVE) SocialBios.com - - -07/17/2011 Adobe Systems Inc. (NasdaqGS:ADBE) EchoSign, Inc. - - -07/17/2011 Groupon, Inc. Zappedy, Inc - - -

Acquirer TargetTarget TTM Revenue

($mm)Implied Enterprise

Value ($mm)

07/14/2011 Mail.ru Group (LSE:MAIL) VKontakte Ltd $93.8 $1,501.3 16.0x07/14/2011 Nuance Communications, Inc. (NasdaqGS:NUAN) Webmedx, Inc. - - -07/13/2011 Open Text Corp. (NasdaqGS:OTEX) Global 360, Inc. $90.0 $260.0 2.9x07/12/2011 Citrix Systems, Inc. (NasdaqGS:CTXS) Cloud.com, Inc. - $250.0 -07/11/2011 Cadence Design Systems Inc. (NasdaqGS:CDNS) Azuro, Inc. - - -07/11/2011 Electronic Arts Inc. (NasdaqGS:ERTS) PopCap Games, Inc. - $1,250.0 7.5x07/11/2011 Google Inc. (NasdaqGS:GOOG) Punchd Labs Inc - - -07/11/2011 Internet Brands, Inc. eHarmony, Inc., Weddingbee.com and - - -07/11/2011 j2 Global Communications, Inc. (NasdaqGS:JCOM) DataHaven Ltd. - - -07/11/2011 Riverbed Technology, Inc. (NasdaqGS:RVBD) Aptimize Limited - $20.0 -07/11/2011 Shanda Games International (Pte) Ltd. Gamonster Inc. - - -07/08/2011 Local.com Corp. (NasdaqCM:LOCM) Screamin Media Group, Inc. $2.4 $32.8 13.7x07/08/2011 Zynga, Inc. Zynga Toronto, Inc. - - -07/07/2011 BMC Software Inc. (NasdaqGS:BMC) BMC Mobility for IT Service Management - - -07/07/2011 PayPal, Inc. Zong, Inc. - $240.0 -07/07/2011 SumTotal Systems, Inc. CyberShift, Inc. - - -07/06/2011 Callidus Software Inc. (NasdaqGM:CALD) iCentera Inc. - - -07/06/2011 Tencent Holdings Ltd. (SEHK:700) Kingsoft Corporation Limited (SEHK:3888) $147.9 $491.2 3.3x07/05/2011 Cap Gemini S.A. (ENXTPA:CAP) AIVE SpA - $62.0 -07/05/2011 DST Health Solutions, Inc. Intellisource Healthcare Solutions, Inc. - - -07/05/2011 Twitter, Inc. BackType, Inc. - - -07/05/2011 Western Union Co. (NYSE:WU) Travelex Global Business Payments, Inc. $227.7 $975.3 4.3x07/01/2011 Compuware Corporation (NasdaqGS:CPWR) dynaTrace software GmbH $26.0 $231.4 9.9x07/01/2011 Sebring Software, Inc. (OTCBB:SMXI) Scalix, Inc. $2.2 $11.7 5.3x


Category Performance

SEG Software Index


SEG Software Index: All Categories

Market Cap EVTTM

Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue

Growth EV/ RevenueEV/

EBITDAForward

EV/ RevenueForward

EV/ EBITDA

YoY Stock Market Return

SEG Software Index $1,103.9 $962.9 $353.1 68.1% 20.2% 15.8% 2.5x 12.4x 2.4x 8.8x 24.6% Billing & Service Management $844.4 $790.2 $328.4 51.2% 20.4% 16.8% 1.7x 7.5x 1.6x 7.1x 9.7% Business Intelligence $1,607.3 $1,467.3 $326.9 79.2% 9.2% 26.3% 4.2x 40.5x 3.5x 22.5x 80.9% Content/Document Management $10,205.9 $9,675.7 $2,541.2 70.2% 26.6% 16.4% 3.0x 10.9x 2.5x 8.8x 36.7% Data Management & Integration $4,822.5 $4,421.3 $773.7 74.8% 23.5% 20.8% 3.1x 15.5x 2.9x 12.7x 55.3% Development Tools & Open Source $8,122.4 $7,211.9 $964.9 77.7% 29.3% 24.3% 2.7x 8.7x 2.7x 6.8x 29.4% Education & eLearning $333.5 $332.9 $197.5 80.7% 22.8% 12.5% 3.1x 14.0x 2.8x 11.8x -9.7% Electronic Design Automation $507.1 $486.3 $139.3 81.7% 10.3% 8.8% 1.8x 17.8x 1.6x 6.4x 18.8% Engineering, PLM & CAD/CAM Software $2,468.3 $2,457.5 $626.7 85.3% 20.2% 13.8% 3.3x 14.5x 2.9x 10.6x 15.9% Enterprise Resource Planning $466.7 $590.5 $319.3 61.4% 13.7% 20.6% 1.8x 9.8x 1.6x 7.6x 12.4% Financial Services $1,080.4 $667.8 $259.4 54.5% 20.9% 11.1% 2.4x 10.5x 2.3x 8.5x 24.7% Healthcare $742.6 $787.6 $231.7 63.5% 23.7% 27.3% 3.1x 18.5x 2.5x 10.8x 38.9% IT Conglomerates $154,903.4 $142,446.4 $69,943.0 62.2% 26.0% 11.9% 2.2x 6.4x 2.1x 5.9x 6.2% Mobile Solutions/Content $273.1 $193.3 $120.3 65.4% 9.9% 18.3% 2.0x 17.1x 1.1x 7.1x 2.7% Multimedia, Graphics, Digital Media $503.0 $494.2 $632.7 66.7% 21.1% 17.6% 3.1x 22.3x 2.9x 7.4x 6.7% Networking & Networking Performance Mgmt. $768.3 $653.6 $171.4 79.7% 22.6% 21.2% 4.2x 20.0x 3.7x 12.9x 45.0% Security $890.4 $734.9 $418.8 82.5% 20.9% 12.8% 2.4x 13.3x 2.4x 11.4x 18.7% Storage & Systems Management Software $13,543.2 $12,644.7 $3,314.8 76.4% 23.1% 10.8% 2.7x 10.3x 2.1x 8.1x 29.4% Supply Chain Management & Logistics $399.8 $293.4 $216.7 55.5% 11.0% 10.2% 2.0x 12.2x 1.9x 8.6x 19.0% Vertical - Finance $1,445.7 $1,599.4 $349.9 52.4% 31.7% 15.6% 3.8x 12.5x 3.4x 10.5x 10.0% Vertical - Other $955.0 $958.0 $323.6 56.0% 18.6% 15.5% 3.0x 13.3x 2.8x 11.8x 30.3% Video Games $2,402.5 $2,259.3 $2,158.2 48.9% 7.9% 0.1% 1.0x 8.2x 1.0x 6.7x 35.6% Workforce & Service Management $761.8 $1,072.5 $423.6 62.7% 7.8% 11.9% 2.3x 15.3x 2.1x 9.8x 50.5%

Category Name

TTM Revenue Growth 15.8%TTM EBITDA Growth 22.3%TTM Earnings Growth 24.4%Gross Profit Margin 68.1%EBITDA Margin 20.2%Net Income Margin 9.9%SG&A Expenses as a % of Total Revenue 34.7%R&D Expenses as a % of Total Revenue 13.4%

Current Ratio 2.1Quick Ratio 1.8Cash as Percent of Market Cap 16.1%Avg Days Outstanding: Accounts Receivable 65Avg Days Outstanding: Accounts Payable 40Working Capital to TTM Operating Expense Ratio 0.4

Levered FCF Margin 12.2%Cash from Operations Growth (YoY) 13.1%Cash from Investing Growth (YoY) 2.8%Cash from Financing Growth (YoY) -19.7%Levered FCF Growth (YoY) 2.2%

Copyright © 2011 by Software Equity Group, L.L.C., All Rights Reserved August 2011 Monthly Flash Report

Income Statement Analysis (Median)

Balance Sheet Analysis (Median)

Cash Flow Statement Analysis (Median)

-3%-2%-1%0%1%2%3%4%5%6%7%8%9%

10%11%12%13%14%

SEG SW Index Software Stock Market Return: Jan - July 2011

DOW S&P NASDAQ SEG SW Index

SEG Software Index Category: Billing and Service Management

Company Name Ticker Market Cap EVTTM

Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ RevenueForward

EV/ EBITDA


Amdocs Limited DOX $5,853.7 $4,719.9 $3,127.7 35.1% 18.9% 6.8% 1.5x 8.0x 1.4x 7.1x 15.4%AsiaInfo Holdings, Inc. ASIA $1,122.1 $827.7 $455.5 44.0% 25.9% 104.5% 1.8x 7.0x 1.7x 6.4x -25.1%CSG Systems International, Inc. CSGS $581.4 $752.6 $652.2 50.7% 21.9% 26.9% 1.2x 5.3x 1.0x 4.3x -5.8%Evolving Systems, Inc. EVOL $77.2 $60.2 $35.1 65.5% 17.9% -10.5% 1.7x 9.6x 1.6x 8.0x 4.1%MIND C.T.I. Ltd. MNDO $47.9 $32.6 $19.0 69.3% 29.9% -0.9% 1.7x 5.7x n/a n/a 32.6%Synchronoss Technologies, Inc. SNCR $1,107.3 $927.8 $201.4 51.8% 14.6% 42.8% 4.6x 31.5x 4.0x 15.0x 50.1%

Median: $844.4 $790.2 $328.4 51.2% 20.4% 16.8% 1.7x 7.5x 1.6x 7.1x 9.7%

TTM Revenue Growth 16.8%TTM EBITDA Growth 3.0%TTM Earnings Growth -0.1%Gross Profit Margin 51.2%EBITDA Margin 20.4%Net Income Margin 14.7%SG&A Expenses as a % of Total Revenue 18.7%R&D Expenses as a % of Total Revenue 13.6%


Levered FCF Margin 2.4%Cash from Operations Growth (YoY) -25.8%Cash from Investing Growth (YoY) -411.5%Cash from Financing Growth (YoY) 70.9%Levered FCF Growth (YoY) -67.3%




August 2011 Monthly Flash Report


-5%

0%

5%

10%

15%

20%Billing and Service Management Software Stock Market Return: Jan - July 2011

Billing and Service Management S&P NASDAQ SEG SW Index

SEG Software Index Category: Business Intelligence


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Actuate Corporation BIRT $279.3 $237.1 $137.9 83.4% 21.4% 15.0% 1.7x 8.0x 1.8x 7.5x 27.5%Informatica Corporation INFA $5,408.4 $4,844.2 $720.0 84.1% 24.7% 27.4% 6.7x 27.3x 5.7x 20.6x 69.7%MicroStrategy Incorporated MSTR $1,706.6 $1,503.4 $513.8 75.1% 7.9% 25.1% 2.9x 36.9x 2.7x 24.0x 92.0%Pegasystems Inc. PEGA $1,508.1 $1,431.2 $385.1 60.7% 6.7% 30.5% 3.7x 55.5x 3.1x 21.2x 31.2%PROS Holdings PRO $437.0 $375.2 $81.1 74.5% 10.5% 18.2% 4.6x 44.1x 3.8x 23.8x 130.8%Qlik Technologies QLIK $2,443.8 $2,269.3 $268.7 88.9% 5.3% 39.2% 8.4x 159.9x 6.3x 46.1x 110.9%

Median: $1,607.3 $1,467.3 $326.9 79.2% 9.2% 26.3% 4.2x 40.5x 3.5x 22.5x 80.9%



Levered FCF Margin 3.8%Cash from Operations Growth (YoY) 6.4%Cash from Investing Growth (YoY) 5.1%Cash from Financing Growth (YoY) -56.6%Levered FCF Growth (YoY) -26.7%






-10%

-5%

0%

5%

10%

15%

20%

25%

30%

35%

40%Business Intelligence Software Stock Market Return: Jan - July 2011

Business Intelligence S&P NASDAQ SEG SW Index

SEG Software Index Category: Content and Document Management


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Adobe Systems Incorporated ADBE $13,685.1 $12,578.0 $4,049.2 89.5% 35.8% 24.3% 3.1x 8.7x 2.9x 6.8x -3.5%Autonomy Corp. LSE:AU. $6,726.7 $6,773.4 $931.1 87.3% 44.1% 12.2% 7.3x 16.5x n/a n/a 7.2%EasyLink Services International ESIC $161.1 $250.2 $137.9 66.8% 24.6% 67.8% 1.8x 7.4x 1.2x n/a 126.5%EMC EMC $53,661.4 $52,666.3 $18,553.9 59.8% 22.4% 19.5% 2.8x 12.7x 2.5x 8.9x 31.8%IBM IBM $217,179.5 $235,244.5 $104,562.0 46.4% 24.7% 7.4% 2.2x 9.1x 2.1x 8.7x 41.6%Open Text Corporation OTEX $3,866.9 $3,927.8 $1,033.3 73.6% 28.6% 13.3% 3.8x 13.3x 3.4x 11.1x 71.0%

Median: $10,205.9 $9,675.7 $2,541.2 70.2% 26.6% 16.4% 3.0x 10.9x 2.5x 8.8x 36.7%



Levered FCF Margin 12.9%Cash from Operations Growth (YoY) 20.8%Cash from Investing Growth (YoY) -95.9%Cash from Financing Growth (YoY) -53.1%Levered FCF Growth (YoY) -8.7%






-5%

0%

5%

10%

15%

20%

25%

Content and Document Management Software Stock Market Return: Jan - July 2011

Content and Document Management S&P NASDAQ SEG SW Index

SEG Software Index Category: Data Management and Integration


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Guidance Software, Inc. GUID $190.4 $165.4 $97.3 70.5% -0.5% 18.8% 1.7x n/a 1.6x 157.2x 57.7%IBM IBM $217,179.5 $235,244.5 $104,562.0 46.4% 24.7% 7.4% 2.2x 9.1x 2.1x 8.7x 41.6%Informatica Corporation INFA $5,408.4 $4,844.2 $720.0 84.1% 24.7% 27.4% 6.7x 27.3x 5.7x 20.6x 69.7%Oracle Corporation ORCL $154,903.4 $142,446.4 $35,622.0 76.4% 40.8% 32.8% 4.0x 9.8x 3.6x 7.3x 29.4%Pervasive Software Inc. PVSW $116.7 $78.2 $48.4 86.7% 10.5% 2.5% 1.6x 15.5x 1.5x 10.9x 52.9%TIBCO Software Inc. TIBX $4,236.5 $3,998.4 $827.5 73.1% 22.3% 22.7% 4.8x 21.7x 4.2x 14.6x 92.0%

Median: $4,822.5 $4,421.3 $773.7 74.8% 23.5% 20.8% 3.1x 15.5x 2.9x 12.7x 55.3%



Levered FCF Margin 13.0%Cash from Operations Growth (YoY) 10.9%Cash from Investing Growth (YoY) 3.0%Cash from Financing Growth (YoY) 7.1%Levered FCF Growth (YoY) 5.0%






-5%

0%

5%

10%

15%

20%

25%

30%Data Management and Integration Software Stock Market Return: Jan - July 2011

Data Management and Integration S&P NASDAQ SEG SW Index

SEG Software Index Category: Development Tools and Open Source


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Adobe Systems Incorporated ADBE $13,685.1 $12,578.0 $4,049.2 89.5% 35.8% 24.3% 3.1x 8.7x 2.9x 6.8x -3.5%BSQUARE Corporation BSQR $66.1 $45.7 $102.4 21.4% 4.3% 35.7% 0.4x 10.5x n/a n/a 96.8%Magic Software Enterprises Ltd. MGIC $187.7 $139.2 $100.3 41.1% 16.6% 45.0% 1.4x 8.4x 1.2x n/a 106.8%Microsoft Corporation MSFT $229,564.5 $191,331.5 $69,943.0 77.7% 42.9% 11.9% 2.7x 6.4x 2.6x 5.9x 6.2%Oracle Corporation ORCL $154,903.4 $142,446.4 $35,622.0 76.4% 40.8% 32.8% 4.0x 9.8x 3.6x 7.3x 29.4%Progress Software Corporation PRGS $1,611.2 $1,222.7 $542.8 84.8% 29.3% 6.1% 2.3x 7.7x 2.1x 6.5x 20.9%Red Hat, Inc. RHT $8,122.4 $7,211.9 $964.9 83.5% 21.3% 23.2% 7.5x 35.0x 6.4x 21.5x 30.9%

Median: $8,122.4 $7,211.9 $964.9 77.7% 29.3% 24.3% 2.7x 8.7x 2.7x 6.8x 29.4%



Levered FCF Margin 18.4%Cash from Operations Growth (YoY) 27.5%Cash from Investing Growth (YoY) 0.5%Cash from Financing Growth (YoY) 37.0%Levered FCF Growth (YoY) -0.7%






-15%

-10%

-5%

0%

5%

10%

15%Development Tools and Open Source Software Stock Market Return: Jan - July 2011

Development Tools and Open Source S&P NASDAQ SEG SW Index

SEG Software Index Category: Education and eLearning


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Archipelago Learning, Inc. ARCL $253.8 $298.2 $68.1 90.9% 31.3% 39.8% 4.4x 14.0x 4.0x 18.8x -11.9%Blackboard Inc. BBBB $1,529.4 $1,640.5 $481.4 68.7% 16.4% 18.2% 3.4x 20.7x 3.0x 11.8x 14.7%Renaissance Learning, Inc. RLRN $377.0 $367.7 $136.1 79.1% 29.1% 6.8% 2.7x 9.3x 2.6x 8.6x -7.6%Rosetta Stone, Inc. RST $290.0 $169.2 $258.9 82.3% -4.3% -3.8% 0.7x n/a 0.6x n/a -35.6%

Median: $333.5 $332.9 $197.5 80.7% 22.8% 12.5% 3.1x 14.0x 2.8x 11.8x -9.7%

TTM Revenue Growth 12.5%TTM EBITDA Growth -1.9%TTM Earnings Growth -44.4%Gross Profit Margin 80.7%EBITDA Margin 22.8%Net Income Margin 3.2%SG&A Expenses as a % of Total Revenue 51.6%R&D Expenses as a % of Total Revenue 10.9%

Current Ratio 0.8Quick Ratio 0.7Cash as Percent of Market Cap 9.9%Avg Days Outstanding: Accounts Receivable 59Avg Days Outstanding: Accounts Payable 51Working Capital to TTM Operating Expense Ratio -0.2

Levered FCF Margin 17.4%Cash from Operations Growth (YoY) -7.1%Cash from Investing Growth (YoY) -42.0%Cash from Financing Growth (YoY) -53.4%Levered FCF Growth (YoY) -2.3%






-20%

-15%

-10%

-5%

0%

5%

10%

15%Education and eLearning Software Stock Market Return: Jan - July 2011

Education & eLearning S&P NASDAQ SEG SW Index

SEG Software Index Category: Electronic Design Automation


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Cadence Design Systems, Inc. SCIL $55.0 $42.6 $42.8 75.2% -6.0% -27.9% 1.0x n/a 0.9x n/a -43.9%Magma Design Automation, Inc. LAVA $507.1 $486.3 $139.3 86.0% 10.3% 13.2% 3.5x 33.9x 3.1x 10.8x 129.6%Mentor Graphics Corporation MENT $1,269.6 $1,372.9 $964.2 85.7% 15.5% 22.1% 1.4x 9.2x 1.4x 6.7x 18.8%PDF Solutions, Inc. PDFS $168.6 $129.3 $63.2 61.1% 7.7% 6.7% 2.0x 26.5x 1.6x 5.8x 46.3%Synopsys, Inc. SNPS $3,515.9 $2,675.4 $1,470.7 81.7% 20.1% 8.8% 1.8x 9.1x 1.7x 6.2x 9.8%

Median: $507.1 $486.3 $139.3 81.7% 10.3% 8.8% 1.8x 17.8x 1.6x 6.4x 18.8%

TTM Revenue Growth 8.8%TTM EBITDA Growth 124.5%TTM Earnings Growth 2.2%Gross Profit Margin 81.7%EBITDA Margin 10.3%Net Income Margin -0.3%SG&A Expenses as a % of Total Revenue 43.9%R&D Expenses as a % of Total Revenue 30.1%


Levered FCF Margin 10.8%Cash from Operations Growth (YoY) -15.3%Cash from Investing Growth (YoY) 33.3%Cash from Financing Growth (YoY) -75.5%Levered FCF Growth (YoY) 4.1%






-10%

-5%

0%

5%

10%

15%

20%

25%

30%

35%Electronic Design Automation Software Stock Market Return: Jan - July 2011

Electronic Design Automation S&P NASDAQ SEG SW Index

SEG Software Index Category: Engineering, PLM & CAD/CAM

Company Name Ticker Market Cap EV

TTM Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


ANSYS, Inc. ANSS $4,645.5 $4,249.2 $626.7 88.0% 49.1% 13.5% 6.8x 13.8x 6.2x 12.1x 12.6%Autodesk, Inc. ADSK $7,944.8 $6,595.0 $2,005.5 90.0% 20.2% 13.8% 3.3x 16.2x 2.9x 10.6x 16.5%Cimatron Ltd. CIMT $31.7 $19.3 $38.6 85.3% 12.3% 16.0% 0.5x 4.1x n/a n/a 143.6%Dassault Systèmes DSY $10,789.7 $9,390.8 $2,474.6 86.0% 30.0% 28.3% 3.8x 12.7x n/a n/a 36.1%GSE Systems Inc. GVP $42.3 $22.9 $47.8 24.2% -1.5% 8.0% 0.5x n/a 0.4x n/a -45.4%Parametric Technology Corporation PMTC $2,468.3 $2,457.5 $1,095.6 69.4% 14.9% 10.9% 2.2x 15.1x 1.9x 8.8x 15.9%Stratasys, Inc. SSYS $538.8 $523.3 $135.9 51.4% 24.3% 25.1% 3.9x 15.9x 3.1x n/a 12.3%

Median: $2,468.3 $2,457.5 $626.7 85.3% 20.2% 13.8% 3.3x 14.5x 2.9x 10.6x 15.9%



Levered FCF Margin 12.9%Cash from Operations Growth (YoY) 13.0%Cash from Investing Growth (YoY) -111.2%Cash from Financing Growth (YoY) -67.5%Levered FCF Growth (YoY) 18.8%






-10%

-5%

0%

5%

10%

15%Engineering, PLM & CAD/CAM Software Stock Market Return: Jan - July 2011

Engineering, PLM & CAD/CAM S&P NASDAQ SEG SW Index

SEG Software Index Category: Enterprise Resource Planning


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


CDC Software Corporation CDCS $117.3 $83.0 $214.7 54.8% 13.7% 5.2% 0.4x 2.8x 0.4x 2.6x -39.2%Deltek PROJ $466.7 $590.5 $319.3 61.4% 8.3% 21.5% 1.8x 22.2x 1.6x 8.0x -4.5%Oracle Corporation ORCL $154,903.4 $142,446.4 $35,622.0 76.4% 40.8% 32.8% 4.0x 9.8x 3.6x 7.3x 29.4%QAD Inc. QADA $169.5 $112.4 $228.6 57.4% 7.7% 8.3% 0.5x 6.4x 0.5x n/a n/aSAP SAP $74,319.9 $74,206.2 $19,433.8 70.2% 35.7% 20.6% 3.8x 10.7x 3.5x 9.2x 36.4%

Median: $466.7 $590.5 $319.3 61.4% 13.7% 20.6% 1.8x 9.8x 1.6x 7.6x 12.4%



Levered FCF Margin 18.4%Cash from Operations Growth (YoY) 3.4%Cash from Investing Growth (YoY) -70.6%Cash from Financing Growth (YoY) 63.0%Levered FCF Growth (YoY) 9.0%






-4%

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%Enterprise Resource Planning Software Stock Market Return: Jan - July 2011

Enterprise Resource Planning S&P NASDAQ SEG SW Index

SEG Software Index Category: Financial Services


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


ACI Worldwide, Inc. ACIW $1,210.2 $1,114.4 $456.2 70.3% 20.9% 11.1% 2.4x 11.7x 2.3x 9.9x 86.4%Bottomline Technologies EPAY $792.6 $645.1 $189.4 54.5% 13.9% 19.9% 3.4x 24.5x 3.0x 13.6x 64.4%DST Systems, Inc. DST $2,378.5 $3,070.9 $2,321.8 19.6% 17.0% 1.7% 1.3x 7.8x 1.6x 5.8x 24.6%EPIQ Systems, Inc. EPIQ $457.4 $652.0 $259.4 59.9% 24.0% 11.2% 2.5x 10.5x 2.0x 7.2x -0.8%Fair Isaac Corporation FICO $1,185.0 $1,446.7 $614.5 69.7% 25.0% 2.0% 2.4x 9.4x 2.3x 8.5x 24.7%Fiserv FISV $8,668.4 $11,646.4 $4,216.0 41.9% 30.7% 3.2% 2.8x 9.0x 2.6x 8.0x 20.5%Longtop Financial Technologies LFT $1,080.4 $667.8 $229.3 51.9% 2.9% 51.0% 2.9x 101.2x 2.3x n/a n/aNetSol Technologies Inc. NTWK $48.7 $70.7 $40.4 72.6% 41.8% 22.6% 1.8x 4.2x 1.6x n/a 3.7%S1 Corporation SONE $506.5 $446.7 $227.3 46.5% 5.4% 2.1% 2.0x 36.4x 1.9x 15.4x 60.1%

Median: $1,080.4 $667.8 $259.4 54.5% 20.9% 11.1% 2.4x 10.5x 2.3x 8.5x 24.7%









-10%

-5%

0%

5%

10%

15%

Financial Services Software Stock Market Return: Jan - July 2011

Financial Services Software S&P NASDAQ SEG SW Index

SEG Software Index Category: Healthcare


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ RevenueForward

EV/ EBITDA


Accelrys Inc. ACCL $403.3 $290.1 $114.8 71.0% -7.0% n/a 2.5x n/a 1.9x 8.7x 3.1%Allscripts Healthcare Solutions Inc. MDRX $3,452.6 $3,756.6 $1,240.0 47.4% 17.0% n/a 3.0x 17.8x 2.5x 11.1x 8.7%Cerner Corporation CERN $11,223.5 $10,656.3 $1,978.8 81.6% 26.7% 12.2% 5.4x 20.2x 4.7x 14.8x 71.7%Computer Programs and Sys, Inc. CPSI $812.6 $787.6 $173.2 45.0% 23.7% 27.3% 4.5x 19.2x 4.2x 17.0x 63.3%eResearchTechnology, Inc. ERT $312.5 $302.8 $174.6 42.5% 24.9% 80.3% 1.7x 7.0x 1.6x 5.6x -21.4%MedAssets MDAS $742.6 $1,653.3 $480.7 75.6% 27.6% 31.1% 3.4x 12.4x 2.7x 8.7x -45.9%Merge Healthcare MRGE $428.1 $618.8 $199.6 63.5% 22.6% 134.4% 3.1x 13.7x 2.5x 10.6x 56.8%Omnicell, Inc. OMCL $566.7 $385.4 $231.7 54.8% 7.2% 6.6% 1.7x 23.0x 1.5x 10.8x 38.9%Quality Systems, Inc. QSII $2,673.6 $2,548.4 $370.9 64.8% 30.3% 20.4% 6.9x 22.7x 5.7x 16.7x 66.4%Simulations Plus, Inc. SLP $51.7 $41.8 $11.8 75.9% 32.7% 14.1% 3.5x 10.8x 3.1x 7.5x 38.8%

Median: $742.6 $787.6 $231.7 63.5% 23.7% 27.3% 3.1x 18.5x 2.5x 10.8x 38.9%

Income Statement Analysis (Median) H lth S ft St k M k t R t J J l 2011TTM Revenue Growth 27.3%TTM EBITDA Growth 40.4%TTM Earnings Growth 30.8%Gross Profit Margin 63.5%EBITDA Margin 23.7%Net Income Margin 4.6%SG&A Expenses as a % of Total Revenue 32.9%R&D Expenses as a % of Total Revenue 7.8%








-10%

-5%

0%

5%

10%

15%

20%Healthcare Software Stock Market Return: Jan - July 2011

Healthcare S&P NASDAQ SEG SW Index

SEG Software Index Category: IT Conglomerates


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ RevenueForward

EV/ EBITDA


Cisco Systems, Inc. CSCO $87,838.0 $61,263.0 $42,859.0 62.2% 26.0% 13.6% 1.4x 5.5x 1.4x 4.5x -30.8%Hewlett Packard HPQ $72,948.1 $83,563.1 $127,941.0 24.4% 14.3% 6.3% 0.7x 4.6x 0.6x 4.5x -23.6%IBM IBM $217,179.5 $235,244.5 $104,562.0 46.4% 24.7% 7.4% 2.2x 9.1x 2.1x 8.7x 41.6%Microsoft Corporation MSFT $229,564.5 $191,331.5 $69,943.0 77.7% 42.9% 11.9% 2.7x 6.4x 2.6x 5.9x 6.2%Oracle Corporation ORCL $154,903.4 $142,446.4 $35,622.0 76.4% 40.8% 32.8% 4.0x 9.8x 3.6x 7.3x 29.4%

Median: $154,903.4 $142,446.4 $69,943.0 62.2% 26.0% 11.9% 2.2x 6.4x 2.1x 5.9x 6.2%



Levered FCF Margin 12.4%Cash from Operations Growth (YoY) 12.1%Cash from Investing Growth (YoY) 20.4%Cash from Financing Growth (YoY) -2.7%Levered FCF Growth (YoY) -1.0%





-5%

0%

5%

10%

15%

20%IT Conglomerates Software Stock Market Return: Jan - July 2011

IT Conglomerates S&P NASDAQ SEG SW Index

SEG Software Index Category: Mobile Solutions/Content


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Access TSE:4813 $299.7 -$2.9 $254.9 68.0% 19.2% -43.8% n/a n/a n/a n/a -44.1%AutoNavi Holdings AMAP $810.6 $640.2 $105.4 69.7% 35.6% n/a 6.1x 17.1x 5.0x 12.9x 13.2%Bitstream Inc. BITS $56.7 $53.3 $26.6 52.7% -13.8% 21.7% 2.0x n/a n/a n/a -22.4%DigitalGlobe, Inc. DGI $1,206.6 $1,389.6 $322.9 85.2% 47.3% 6.6% 4.3x 9.1x 3.9x 6.4x -4.2%Glu Mobile, Inc. GLUU $270.6 $246.2 $65.2 77.6% -3.5% -9.4% 3.8x n/a 3.9x n/a 286.2%Gree TSE:3632 $5,250.1 $4,950.3 $795.8 91.4% 48.8% 82.2% 6.2x 12.7x n/a n/a 39.8%Myriad Group SWX:MYRN $208.9 $172.7 $101.0 66.7% 8.2% -4.2% 1.7x 20.9x n/a n/a -5.8%Motricity MOTR $275.5 $214.0 $140.7 64.1% 14.1% 24.7% 1.5x 10.8x 1.1x 4.0x -25.8%Openwave Systems Inc. OPWV $191.7 $109.5 $155.5 60.3% -9.8% -15.1% 0.7x n/a 0.7x 23.2x 10.8%Opera OB:OPERA $768.6 $677.8 $135.2 43.8% 22.0% 24.4% 5.0x 22.8x n/a n/a 65.7%PCTEL, Inc. PCTI $120.3 $63.6 $73.2 45.1% 1.9% 18.3% 0.9x 46.8x 0.8x 7.6x 2.7%Sky-mobi Limited MOBI $241.9 $162.6 $103.1 31.2% 3.5% 24.1% 1.6x 45.3x 1.1x 6.7x n/aSmith Micro Software, Inc. SMSI $127.7 $63.3 $103.2 85.3% -2.4% -13.1% 0.6x n/a 0.7x n/a -63.8%TeleCommunication Systems, Inc. TSYS $288.1 $376.1 $396.3 36.8% 11.5% 14.5% 0.9x 8.2x 0.8x 5.8x 41.5%Trunkbow International Holdings TBOW $121.9 $100.6 $25.5 79.2% 58.4% 48.6% 3.9x 6.8x n/a n/a n/aVelti Plc VELT $972.1 $929.6 $142.0 60.2% 7.7% 24.5% 6.5x 85.2x 5.0x 16.4x n/a

Median: $273.1 $193.3 $120.3 65.4% 9.9% 18.3% 2.0x 17.1x 1.1x 7.1x 2.7%

TTM Revenue Growth 18.3%TTM EBITDA Growth -1.9%TTM Earnings Growth -5.5%Gross Profit Margin 65.4%EBITDA Margin 9.9%Net Income Margin -2.7%SG&A Expenses as a % of Total Revenue 32.3%R&D Expenses as a % of Total Revenue 20.2%








-10%

-5%

0%

5%

10%

15%Mobile Solutions/Content Software Stock Market Return: Jan - July 2011

Mobile Solutions/Content S&P NASDAQ SEG SW Index

SEG Software Index Category: Multimedia, Graphics and Digital Media


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Adobe Systems Incorporated ADBE $13,685.1 $12,578.0 $4,049.2 89.5% 35.8% 24.3% 3.1x 8.7x 2.9x 6.8x -3.5%Avid Technology, Inc. AVID $503.0 $478.4 $688.1 52.7% 3.1% 6.7% 0.7x 22.3x 0.7x 7.4x 1.2%Monotype Imaging Holdings TYPE $489.9 $494.2 $118.6 92.6% 41.1% 22.2% 4.2x 10.2x 3.9x 8.8x 64.7%Nuance Communications, Inc. NUAN $6,057.2 $6,252.9 $1,261.5 66.7% 21.1% 17.6% 5.0x 23.5x 4.3x 11.0x 21.2%RealNetworks, Inc. RNWK $462.4 $134.5 $355.3 63.2% 0.9% -29.4% 0.4x 42.9x 0.4x 5.1x 1.8%Rovi Corporation ROVI $5,982.2 $6,522.3 $632.7 85.0% 38.6% 22.9% 10.3x 26.7x 7.8x 16.8x 19.0%SeaChange International, Inc. SEAC $307.2 $218.9 $214.2 49.6% 9.8% 3.3% 1.0x 10.4x 0.9x 4.8x 6.7%

Median: $503.0 $494.2 $632.7 66.7% 21.1% 17.6% 3.1x 22.3x 2.9x 7.4x 6.7%









-15%

-10%

-5%

0%

5%

10%

15%

20%Multimedia, Graphics and Digital Media Software Stock Market Return: Jan - July 2011

Multimedia, Graphics & Digital Media S&P NASDAQ SEG SW Index

SEG Software Index Category: Networking/Network Performance Mgmt


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Allot Communications Ltd. ALLT $352.8 $291.9 $66.5 71.6% 12.2% 37.2% 4.4x 36.0x 4.0x n/a 206.2%Cisco Systems, Inc. CSCO $87,838.0 $61,263.0 $42,859.0 62.2% 26.0% 13.6% 1.4x 5.5x 1.4x 4.5x -30.8%F5 Networks, Inc. FFIV $7,546.4 $6,961.0 $1,091.5 81.8% 32.0% 36.0% 6.4x 20.0x 5.3x 12.9x 6.4%NetScout Systems Inc. NTCT $651.6 $534.2 $287.0 78.9% 22.6% 6.7% 1.9x 8.2x 1.7x 6.3x -3.8%OPNET Technologies, Inc. OPNT $768.3 $653.6 $157.1 79.9% 18.3% 21.2% 4.2x 22.7x 3.7x 16.9x 125.1%Radware Ltd. RDWR $696.4 $607.7 $155.6 79.7% 13.9% 20.0% 3.9x 28.0x 3.5x n/a 45.0%SolarWinds, Inc. SWI $1,563.2 $1,419.9 $171.4 94.5% 46.9% 26.8% 8.3x 17.7x 7.1x 13.8x 55.6%

Median: $768.3 $653.6 $171.4 79.7% 22.6% 21.2% 4.2x 20.0x 3.7x 12.9x 45.0%









-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%Networking/Network Performance Mgmt Software Stock Market Return: Jan - July 2011

Networking & Network Performance Management S&P NASDAQ SEG SW Index

SEG Software Index Category: Security


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Blue Coat Systems, Inc. BCSI $874.7 $576.8 $487.1 78.1% 18.7% -1.8% 1.2x 6.3x 1.2x 6.6x -8.0%Check Point Software Tech Ltd. CHKP $11,967.5 $10,817.0 $1,173.6 88.1% 54.8% 16.0% 9.2x 16.8x 8.3x 13.9x 69.5%Commtouch Software Ltd. CTCH $85.6 $71.2 $21.2 83.0% 21.8% 31.6% 3.4x 15.4x 2.9x n/a 10.6%Sourcefire, Inc. FIRE $694.3 $555.1 $141.4 78.7% 9.1% 18.7% 3.9x 43.0x 3.5x 19.3x 15.2%Symantec Corporation SYMC $14,400.6 $14,182.6 $6,410.0 85.2% 27.1% 7.1% 2.2x 8.2x 2.1x 5.6x 47.0%Trend Micro TSE:4704 $4,140.7 $2,697.3 $1,196.4 81.9% 33.0% 0.1% 2.3x 6.8x n/a n/a 6.4%VASCO Data Security International VDSI $365.4 $280.8 $138.6 65.5% 14.7% 35.0% 2.0x 13.7x 1.8x 15.3x 52.0%Websense, Inc. WBSN $906.1 $892.9 $350.5 83.5% 19.9% 9.5% 2.5x 12.8x 2.4x 8.9x 22.2%

Median: $890.4 $734.9 $418.8 82.5% 20.9% 12.8% 2.4x 13.3x 2.4x 11.4x 18.7%

Income Statement Analysis (Median) Security Software Stock Market Return: Jan - July 2011TTM Revenue Growth 12.8%TTM EBITDA Growth 17.0%TTM Earnings Growth 3.8%Gross Profit Margin 82.5%EBITDA Margin 20.9%Net Income Margin 12.6%SG&A Expenses as a % of Total Revenue 47.5%R&D Expenses as a % of Total Revenue 16.9%







y ( )

-10%

-5%

0%

5%

10%

15%

20%Security Software Stock Market Return: Jan - July 2011

Security S&P NASDAQ SEG SW Index

SEG Software Index Category: Storage and Systems Management


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


BMC Software, Inc. BMC $7,586.0 $6,325.4 $2,106.8 76.1% 32.1% 9.6% 3.0x 9.3x 2.8x 6.3x 21.5%CA, Inc. CA $11,254.7 $9,705.7 $4,523.0 86.8% 35.2% 6.4% 2.1x 6.1x 2.0x 5.3x 14.0%Citrix Systems CTXS $13,543.2 $12,644.7 $2,023.6 90.3% 25.5% 17.3% 6.2x 24.5x 5.5x 18.7x 30.9%CommVault Systems, Inc. CVLT $1,721.0 $1,502.7 $340.0 87.2% 13.6% 22.7% 4.4x 32.6x 4.1x 22.0x 109.1%Compuware Corporation CPWR $2,110.1 $1,915.2 $952.4 68.1% 20.8% 7.7% 2.0x 9.7x 1.8x 7.5x 18.1%EMC EMC $53,661.4 $52,666.3 $18,553.9 59.8% 22.4% 19.5% 2.8x 12.7x 2.5x 8.9x 31.8%FalconStor Software, Inc. FALC $200.4 $158.5 $84.0 73.1% -8.3% 3.3% 1.9x n/a 1.8x n/a 40.1%IBM IBM $217,179.5 $235,244.5 $104,562.0 46.4% 24.7% 7.4% 2.2x 9.1x 2.1x 8.7x 41.6%Network Appliance, Inc. NTAP $17,696.0 $13,786.3 $5,122.6 65.0% 18.7% 30.3% 2.7x 14.4x 2.0x 9.8x 12.3%Oracle Corporation ORCL $154,903.4 $142,446.4 $35,622.0 76.4% 40.8% 32.8% 4.0x 9.8x 3.6x 7.3x 29.4%Quest Software, Inc. QSFT $1,699.4 $1,375.3 $801.0 88.8% 15.8% 10.8% 1.7x 10.9x 1.6x 6.3x -5.9%Symantec Corporation SYMC $14,400.6 $14,182.6 $6,410.0 85.2% 27.1% 7.1% 2.2x 8.2x 2.1x 5.6x 47.0%VMWare VMW $42,302.1 $39,049.0 $3,314.8 82.8% 23.1% 37.8% 11.8x 51.0x 9.6x 25.9x 29.4%

Median: $13,543.2 $12,644.7 $3,314.8 76.4% 23.1% 10.8% 2.7x 10.3x 2.1x 8.1x 29.4%









-5%

0%

5%

10%

15%

20%Storage and Systems Management Software Stock Market Return: Jan - July 2011

Storage and Systems Management S&P NASDAQ SEG SW Index

SEG Software Index Category: Supply Chain Management & Logistics


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


American Software, Inc. AMSW.A $224.3 $179.8 $85.6 53.0% 13.4% 13.7% 2.1x 15.7x 1.9x n/a 70.5%Ariba, Inc. ARBA $3,068.4 $2,857.8 $446.7 63.5% 7.2% 39.7% 6.4x 88.5x 5.7x 24.2x 107.1%Aspen Technology, Inc. AZPN $1,458.8 $1,363.2 $183.8 70.2% -37.0% -7.8% 7.4x n/a 6.2x n/a 41.8%CDC Software Corporation CDCS $117.3 $83.0 $214.7 54.8% 13.7% 5.2% 0.4x 2.8x 0.4x 2.6x -39.2%JDA Software Group JDAS $1,183.0 $1,199.8 $653.2 58.5% 24.3% 32.5% 1.8x 7.5x 1.7x 6.1x 19.0%Manhattan Associates, Inc. MANH $789.1 $679.7 $305.6 56.3% 17.3% 9.5% 2.2x 12.9x 2.0x 9.0x 38.9%ModusLink Global Solutions, Inc. MLNK $181.7 $62.5 $905.8 10.4% 2.6% -1.7% 0.1x 2.7x n/a n/a -36.1%Retalix Ltd. RTLX $370.6 $233.5 $218.7 41.3% 8.6% 10.9% 1.1x 12.4x 1.0x 8.2x n/aThe Descartes Systems Group Inc. TSX:DSG $429.0 $353.3 $105.0 66.3% 27.7% 35.2% 3.4x 12.2x 3.0x 10.5x 17.4%XATA Corporation XATA $19.7 $51.2 $64.8 51.2% 7.3% -7.1% 0.8x 10.8x n/a n/a -30.0%

Median: $399.8 $293.4 $216.7 55.5% 11.0% 10.2% 2.0x 12.2x 1.9x 8.6x 19.0%



Levered FCF Margin 10.9%Cash from Operations Growth (YoY) 18.4%Cash from Investing Growth (YoY) -27.9%Cash from Financing Growth (YoY) -100.5%Levered FCF Growth (YoY) -5.9%






-4%

-2%

0%

2%

4%

6%

8%

10%

12%

14%Supply Chain Management & Logistics Software Stock Market Return: Jan - July 2011

Supply Chain Management and Logistics S&P NASDAQ SEG SW Index

SEG Software Index Category: Vertical - Finance


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Advent Software, Inc. ADVS $1,217.8 $1,139.3 $302.9 71.9% 20.8% 13.9% 3.8x 18.1x 3.4x 12.0x -9.4%Fundtech Ltd. FNDT $288.0 $207.0 $151.4 52.4% 13.1% 15.1% 1.4x 10.4x 1.3x 7.6x 57.5%Jack Henry & Associates, Inc. JKHY $2,499.2 $2,688.5 $966.9 41.3% 31.7% 15.6% 2.8x 8.8x 2.6x 8.3x 14.0%MSCI, Inc. MSCI $4,263.7 $5,205.1 $662.9 70.0% 44.5% 49.7% 7.9x 17.6x 5.6x 11.9x 10.0%SS&C Corporation SSNC $1,445.7 $1,599.4 $349.9 49.7% 36.6% 16.7% 4.6x 12.5x 4.2x 10.5x 8.3%

Median: $1,445.7 $1,599.4 $349.9 52.4% 31.7% 15.6% 3.8x 12.5x 3.4x 10.5x 10.0%



Levered FCF Margin 10.0%Cash from Operations Growth (YoY) -0.5%Cash from Investing Growth (YoY) 60.8%Cash from Financing Growth (YoY) -32.0%Levered FCF Growth (YoY) -8.2%






-10%

-5%

0%

5%

10%

15%Vertical - Finance Software Stock Market Return: Jan - July 2011

Vertical - Finance S&P NASDAQ SEG SW Index

SEG Software Index Category: Vertical - Other


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Blackbaud, Inc. BLKB $1,100.4 $1,076.2 $350.9 58.7% 19.3% 11.4% 3.1x 15.9x 2.8x 11.8x 7.2%Constellation TSX:CSU $1,630.6 $1,658.7 $705.2 56.9% 20.5% 31.2% 2.4x 11.5x 2.2x 10.7x 93.5%Ebix, Inc. EBIX $777.2 $772.1 $150.7 80.4% 44.1% 27.3% 5.1x 11.6x 4.3x 9.3x 18.5%Itron, Inc. ITRI $1,747.3 $2,154.6 $2,370.4 31.3% 14.1% 21.6% 0.9x 6.5x 0.9x 6.4x -33.9%Micros Systems MCRS $3,972.1 $3,229.3 $981.9 55.1% 22.0% 10.5% 3.3x 14.9x 3.0x 12.5x 36.9%PROS Holdings PRO $437.0 $375.2 $81.1 74.5% 10.5% 18.2% 4.6x 44.1x 3.8x 23.8x 130.8%Sapiens International SPNS $81.6 $65.7 $55.4 44.6% 14.0% 12.7% 1.2x 8.5x n/a n/a 23.7%Tyler Technologies, Inc. TYL $809.7 $839.8 $296.3 44.7% 17.9% 1.8% 2.8x 15.8x 2.6x 13.7x 55.1%

Median: $955.0 $958.0 $323.6 56.0% 18.6% 15.5% 3.0x 13.3x 2.8x 11.8x 30.3%








-5%

0%

5%

10%

15%

20%

25%

30%

Vertical - Other Software Stock Market Return: Jan - July 2011

Vertical - Other S&P NASDAQ SEG SW Index

SEG Software Index Category: Video Games


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Activision Blizzard ATVI $13,546.9 $10,187.9 $4,767.0 57.6% 28.1% 5.1% 2.1x 7.6x 2.5x 6.4x -0.3%Electronic Arts Inc. ERTS $7,372.4 $5,524.4 $3,773.0 59.8% 4.0% -1.4% 1.5x 36.3x 1.3x 9.2x 39.7%Konami Corporation TSE: 9766 $3,635.8 $3,522.4 $3,220.5 28.2% 14.9% 0.1% 1.1x 7.3x 1.0x 6.7x 70.5%Majesco Entertainment Company COOL $100.2 $81.7 $116.1 34.3% 10.4% 43.0% 0.7x 6.7x 0.6x n/a 263.0%TakeTwo Interactive TTWO $1,169.3 $996.2 $1,095.9 40.1% 5.3% n/a 0.9x 17.0x 0.9x 19.7x 31.6%THQ Inc. THQI $182.1 $163.1 $711.0 60.8% 2.6% -11.7% 0.2x 8.9x 0.2x 4.4x -41.6%

Median: $2,402.5 $2,259.3 $2,158.2 48.9% 7.9% 0.1% 1.0x 8.2x 1.0x 6.7x 35.6%









-10%

-5%

0%

5%

10%

15%

20%

25%

Video Game Software Stock Market Return: Jan - July 2011

Video Games S&P NASDAQ SEG SW Index

SEG Software Index Category: Workforce and Service Management


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


ClickSoftware Technologies Ltd. CKSW $277.5 $221.8 $75.9 62.6% 16.5% 10.3% 2.9x 17.7x 2.5x 11.1x 56.2%Callidus Software, Inc. CALD $172.8 $146.3 $77.7 42.1% -3.7% 17.6% 1.9x n/a 1.8x 21.8x 44.8%NICE Systems Ltd. NICE $2,304.8 $1,950.2 $741.7 61.5% 16.2% 17.4% 2.6x 16.3x 2.3x 9.2x n/aSaba Software SABA $219.6 $194.9 $116.7 63.8% -0.5% 6.5% 1.7x n/a 1.5x n/a 58.0%Verint VRNT $1,304.0 $2,010.1 $730.5 69.0% 19.3% 4.2% 2.8x 14.3x 2.5x 9.8x 50.5%

Median: $761.8 $1,072.5 $423.6 62.7% 7.8% 11.9% 2.3x 15.3x 2.1x 9.8x 50.5%








-5%

0%

5%

10%

15%

20%

25%

30%Workforce and Service Mgmt Software Stock Market Return: Jan - July 2011

Workforce and Service Mgmt S&P NASDAQ SEG SW Index

Company Performance

SEG SaaS Index


SEG SaaS Index


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ RevenueForward

EV/ EBITDA


Athenahealth ATHN $2,056.9 $1,952.5 $280.3 62.5% 16.9% 30.5% 7.0x 41.2x 5.3x 25.5x 111.7%Concur CNQR $2,451.9 $2,132.9 $331.8 72.0% 14.7% 18.4% 6.4x 43.8x 5.3x 18.7x -1.8%Constant Contact CTCT $557.8 $438.1 $194.8 71.1% 8.0% 28.2% 2.2x 28.1x 1.9x 10.0x -2.9%Convio CNVO $183.2 $134.4 $73.8 62.5% 8.7% 10.2% 1.8x 21.0x 1.6x 10.9x 26.7%Cornerstone OnDemand CSOD $779.6 $691.6 $56.6 68.9% -28.2% n/a 12.2x n/a 8.8x n/a n/aDealerTrack TRAK $953.5 $896.0 $291.4 47.1% 15.7% 26.3% 3.1x 19.6x 2.7x 13.7x 48.6%DemandTec DMAN $233.1 $167.6 $86.8 64.3% -8.5% 12.0% 1.9x n/a 1.8x 28.3x 6.4%Ellie Mae ELLI $118.7 $186.1 $46.7 71.7% 10.5% n/a 4.0x 38.0x 3.6x 19.0x n/aIntraLinks Holdings IL $798.0 $878.5 $205.7 74.6% 13.9% 30.6% 4.3x 30.6x 3.9x 11.6x n/aKenexa KNXA $675.2 $697.1 $240.8 62.7% 7.3% 46.9% 2.9x 39.6x 2.5x 15.4x 112.6%LivePerson LPSN $648.4 $581.2 $120.4 72.9% 20.5% 21.9% 4.8x 23.5x 4.1x 16.7x 74.9%Medidata Solutions MDSO $495.8 $405.2 $179.4 70.3% 21.4% 19.0% 2.3x 10.5x 2.1x 8.9x 35.5%Netsuite N $2,590.1 $2,469.0 $213.1 69.8% -7.9% 21.1% 11.6x n/a 9.6x 85.3x 164.2%RealPage RP $1,672.4 $1,611.5 $221.3 57.9% 13.1% 38.3% 7.3x 55.4x 5.9x 25.4x n/aResponsys MKTG $683.6 $735.3 $116.9 54.0% 18.5% n/a 6.3x 34.1x 5.6x 34.5x n/aRightNow RNOW $1,121.9 $1,041.0 $207.1 69.9% 10.3% 24.9% 5.0x 48.9x 4.2x 23.4x 114.6%Salesforce.com CRM $19,376.7 $19,140.3 $1,784.7 80.1% 7.8% 29.6% 10.7x 138.0x 8.3x 48.6x 46.2%SciQuest SQI $372.9 $341.6 $47.2 77.0% 15.3% 19.7% 7.2x 47.4x 6.0x 28.2x n/aSoundBite Communications SDBT $39.4 $5.5 $38.6 58.9% -3.9% -5.2% 0.1x n/a 0.1x n/a -15.8%SPS Commerce SPSC $219.6 $189.8 $50.0 72.8% 7.6% 22.5% 3.8x 49.8x 3.0x 29.2x 72.7%SuccessFactors SFSF $2,133.6 $1,766.1 $252.1 68.9% -11.2% 44.0% 7.0x n/a 6.0x 187.4x 32.9%Taleo TLEO $1,359.3 $1,213.6 $273.7 67.3% 13.1% 28.7% 4.4x 33.9x 3.7x 19.0x 34.6%The Ultimate Software Group, Inc. ULTI $1,405.1 $1,357.7 $246.1 56.5% 8.6% 16.8% 5.5x 64.1x 4.6x 23.9x 68.6%Vocus VOCS $561.5 $445.1 $106.2 80.7% 0.9% 19.1% 4.2x 490.7x 3.6x 20.7x 75.4%Zix Corporation ZIXI $254 9 $237 9 $36 1 80 7% 27 2% 31 5% 6 6x 24 2x 5 7x 16 8x 68 4%Zix Corporation ZIXI $254.9 $237.9 $36.1 80.7% 27.2% 31.5% 6.6x 24.2x 5.7x 16.8x 68.4%

Median: $683.6 $697.1 $194.8 69.8% 10.3% 23.7% 4.8x 38.8x 4.1x 20.7x 48.6%


Balance Sheet Analysis (Median)Current Ratio 2.0Quick Ratio 1.9Cash as Percent of Market Cap 12.3%Avg Days Outstanding: Accounts Receivable 58Avg Days Outstanding: Accounts Payable 28Working Capital to TTM Operating Expense Ratio 0.4

Cash Flow Statement Analysis (Median)Levered FCF Margin 4.4%Cash from Operations Growth (YoY) 33.4%Cash from Investing Growth (YoY) -142.7%Cash from Financing Growth (YoY) 190.4%Levered FCF Growth (YoY) 8.2%




-4%

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%SEG SaaS Index Software Stock Market Return: Jan - July 2011

SEG SaaS S&P NASDAQ SEG SW Index

Category Performance

SEG Internet Index


SEG Internet Index: All Categories

Category Name Market Cap EVTTM

Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


SEG Internet Index $884.51 $825.48 $342.93 65.2% 16.3% 20.1% 2.6x 14.1x 2.2x 9.5x 27.7% Ad Tech & Lead Generation $454.16 $414.63 $163.98 43.7% 9.8% 24.8% 1.9x 17.1x 1.9x 9.0x 6.9% Infastructure $586.39 $487.50 $222.75 62.7% 15.3% 21.5% 2.4x 13.9x 2.2x 8.1x 32.9% Media $1,960.02 $1,685.73 $437.34 52.6% 17.9% 16.3% 2.6x 12.1x 3.0x 9.0x -5.6% Retail $497.36 $460.69 $336.27 40.5% 9.4% 16.4% 1.6x 14.5x 1.4x 10.4x 45.8% Search $1,990.59 $1,602.49 $522.41 54.9% 11.3% 26.1% 1.4x 12.5x 1.2x 9.3x 27.7% Services $1,151.97 $1,344.86 $306.43 73.1% 17.6% 18.1% 5.2x 26.2x 3.7x 18.0x 56.6% Travel $4,878.20 $4,822.11 $628.99 78.8% 20.6% 25.5% 6.1x 28.4x 5.8x 18.4x 27.1% Video Games $2,712.34 $2,305.88 $582.18 78.2% 49.7% 29.7% 5.6x 10.3x 3.0x 6.3x 31.9%








-4%

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%SEG Internet Index Software Stock Market Return: Jan - July 2011

SEG Internet Index S&P NASDAQ SEG SW Index

SEG Internet Index Category: Ad Tech and Lead Generation


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


comScore Inc. SCOR $694.8 $665.4 $207.9 68.4% 4.3% 44.6% 3.2x 73.9x 2.6x 12.3x 10.1%DG FastChannel, Inc. DGIT $774.6 $691.9 $268.4 66.6% 44.9% 24.1% 2.6x 5.7x 2.2x 4.9x -25.9%interCLICK, Inc. ICLK $176.0 $175.2 $118.2 43.0% 9.2% 64.0% 1.5x 16.1x 1.2x 9.0x 84.8%Inuvo, Inc. INUV $16.8 $19.3 $49.3 43.6% 2.2% 25.5% 0.4x 18.1x n/a n/a 1.2%LookSmart, Ltd. LOOK $25.2 $4.1 $36.2 43.7% 10.5% -29.9% 0.1x 1.1x 0.1x 1.0x -2.7%Marchex Inc. MCHX $322.1 $282.1 $120.0 42.0% 1.7% 31.9% 2.4x 140.9x 1.9x 12.9x 86.1%QuinStreet QNST $586.2 $547.2 $403.0 27.5% 18.9% 20.4% 1.4x 7.2x 1.3x 6.2x 3.7%SINA Corporation SINA $7,119.5 $6,315.9 $417.8 57.3% 25.9% 13.0% 15.1x 58.4x 12.6x 85.5x 152.7%ValueClick, Inc. VCLK $1,421.0 $1,221.2 $477.1 71.3% 28.7% 16.1% 2.6x 8.9x 2.3x 7.6x 64.9%

Median: $454.2 $414.6 $164.0 43.7% 9.8% 24.8% 1.9x 17.1x 1.9x 9.0x 6.9%









-10%

-5%

0%

5%

10%

15%

20%

25%

30%Internet Ad Tech and Lead Generation Software Stock Market Return: Jan - July 2011

Internet Ad Tech and Lead Generation S&P NASDAQ SEG Internet Index

SEG Internet Index Category: Infrastructure


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ RevenueForward

EV/ EBITDA


8x8, Inc. EGHT $244.0 $225.1 $71.8 67.6% 11.7% 11.1% 3.1x 26.7x 2.8x 18.1x 172.7%Akamai Technologies, Inc. AKAM $4,522.0 $4,024.8 $1,091.2 69.9% 38.6% 17.3% 3.7x 9.6x 3.3x 7.5x -36.9%BroadSoft, Inc. BSFT $778.5 $712.0 $119.9 82.2% 21.5% 59.7% 5.9x 27.7x 5.4x 25.6x 237.7%Cbeyond, Inc. CBEY $351.3 $334.0 $469.3 67.6% 13.0% 7.6% 0.7x 5.5x 0.7x 4.1x -26.3%ChinaCache International CCIH $185.4 $98.6 $70.8 31.2% 9.2% n/a 1.4x 15.1x 1.0x 4.5x n/aDigital River Inc. DRIV $1,011.1 $656.3 $373.4 82.5% 13.9% -3.0% 1.8x 12.6x 1.6x 6.9x -3.0%EarthLink Inc. ELNK $884.5 $931.1 $918.5 57.8% 27.3% 41.5% 1.0x 3.7x 0.7x 2.9x -8.9%Equinix, Inc. EQIX $4,913.7 $6,848.5 $1,433.5 44.9% 40.1% 41.3% 4.8x 11.9x 3.9x 8.7x 11.7%Interactive Intelligence, Inc. ININ $710.7 $641.0 $192.2 68.8% 16.2% 34.5% 3.3x 20.6x 2.8x 15.9x 134.9%Internap Network Services Corp. INAP $315.0 $323.0 $240.1 40.7% 14.5% -4.7% 1.3x 9.3x 1.3x 6.8x 32.9%Keynote Systems Inc. KEYN $394.4 $302.9 $96.0 54.0% 18.2% 21.5% 3.2x 17.3x 2.8x 11.7x 139.3%Limelight Networks, Inc. LLNW $462.1 $329.9 $205.4 54.8% 1.6% 42.2% 1.6x 99.9x 1.4x 10.3x -3.1%Rackspace Hosting RAX $5,171.8 $5,172.8 $891.7 69.1% 28.3% 27.7% 5.8x 20.5x 4.9x 14.4x 113.9%Tucows Inc. TCX $42.8 $39.4 $88.9 24.4% 6.8% 8.2% 0.4x 6.5x 0.4x 5.2x 33.3%VeriSign, Inc. VRSN $5,193.3 $4,383.5 $722.5 77.9% 48.3% 12.6% 6.1x 12.6x 5.4x 10.2x 10.9%

Median: $586.4 $487.5 $222.7 62.7% 15.3% 21.5% 2.4x 13.9x 2.2x 8.1x 32.9%

Income Statement Analysis (Median)TTM Revenue Growth 21.5%TTM EBITDA Growth 19.1%TTM Earnings Growth 50.7%Gross Profit Margin 62.7%EBITDA Margin 15.3%Net Income Margin 5.6%SG&A Expenses as a % of Total Revenue 38.6%R&D Expenses as a % of Total Revenue 7.5%








-5%

0%

5%

10%

15%

20%

25%Internet Infrastructure Software Stock Market Return: Jan - July 2011

Internet Infrastructure S&P NASDAQ SEG Internet Index

SEG Internet Index Category: Media


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


AOL, Inc. AOL $1,837.0 $1,553.8 $2,253.8 33.4% 20.5% -21.1% 0.7x 3.4x 0.7x 3.8x -17.9%DemandMedia DMD $843.7 $735.7 $297.9 51.3% 20.6% 34.7% 2.5x 12.0x 2.2x 7.9x n/aeHealth, Inc. EHTH $277.0 $141.1 $161.9 81.8% 21.3% 14.2% 0.9x 4.1x 0.9x 6.4x 16.7%Google, Inc. GOOG $194,924.1 $161,943.1 $33,328.0 65.2% 38.4% 27.1% 4.9x 12.7x 3.9x 9.3x 24.5%Local.com Corp. LOCM $73.8 $53.6 $74.9 40.8% 1.0% 2.4% 0.7x 74.7x 0.6x n/a -44.6%Monster Worldwide, Inc. MWW $1,442.0 $1,365.1 $1,015.0 49.4% 11.0% 18.3% 1.3x 12.2x 1.2x 5.7x -14.4%Netflix NFLX $13,974.1 $13,832.8 $2,656.3 37.4% 15.2% 41.2% 5.2x 34.3x 3.5x 23.7x 159.4%Pandora P $2,410.3 $2,374.0 $167.2 40.5% -0.3% n/a 14.2x n/a 7.9x n/a n/aSohu.com Inc. SOHU $3,450.2 $2,836.6 $710.3 73.6% 41.1% 29.6% 4.0x 9.7x 3.4x 9.8x 91.6%TheStreet.com, Inc. TST $90.3 $38.4 $58.2 53.9% -7.9% -2.9% 0.7x n/a n/a n/a -7.5%WebMD Health Corp. WBMD $2,083.0 $1,817.6 $576.8 65.5% 26.1% 20.1% 3.2x 12.1x 3.0x 8.7x -23.8%XO Group XOXO $295.3 $194.4 $117.1 80.1% 11.5% 5.2% 1.7x 14.4x 1.6x 11.2x 13.6%Yahoo! Inc. YHOO $17,068.5 $14,691.1 $5,569.7 64.3% 25.7% -14.4% 2.6x 10.3x 3.2x 9.5x -5.6%Youku YOKU $4,199.0 $3,940.4 $91.7 32.2% 3.5% n/a 43.0x 1225.1x 27.3x n/a n/a

Median: $1,960.0 $1,685.7 $437.3 52.6% 17.9% 16.3% 2.6x 12.1x 3.0x 9.0x -5.6%









-15%

-10%

-5%

0%

5%

10%

15%

20%Internet Media Software Stock Market Return: Jan - July 2011

Internet Media S&P NASDAQ SEG Internet Index

SEG Internet Index Category: Retail


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


1-800-FLOWERS.COM, Inc. FLWS $192.7 $226.2 $668.1 40.6% 5.0% -1.0% 0.3x 6.7x 0.3x 5.1x 35.0%Amazon.com, Inc. AMZN $101,009.6 $94,654.6 $40,277.0 22.4% 4.5% 40.5% 2.4x 51.8x 1.7x 32.0x 88.8%Bitauto Holdings Limited BITA $277.6 $171.9 $76.0 67.5% 16.4% n/a 2.3x 13.8x 1.7x 7.0x n/aBluefly, Inc. BFLY $66.9 $59.4 $93.5 34.8% -1.6% 13.7% 0.6x n/a n/a n/a n/aBlueNile NILE $619.0 $540.7 $342.9 21.6% 6.7% 7.0% 1.6x 23.6x 1.4x 16.0x -16.8%DangDang DANG $884.5 $636.0 $385.0 21.8% 1.2% n/a 1.7x 138.6x 1.1x 122.3x n/aeBay Inc. EBAY $42,206.9 $40,355.6 $10,050.7 71.7% 30.0% 11.4% 4.0x 13.4x 3.2x 9.6x 56.6%IAC/InterActiveCorp IACI $3,518.2 $2,758.6 $1,810.0 62.6% 12.2% 25.1% 1.5x 12.5x 1.3x 7.2x 65.6%Liquidity Services, Inc. LQDT $674.9 $578.8 $329.6 42.1% 12.1% 19.1% 1.8x 14.5x 1.7x 10.8x 78.1%Mecox Lane Limited MCOX $163.8 $63.4 $226.3 40.4% 2.7% 19.9% 0.3x 10.4x 0.3x n/a n/aMercadolibre, Inc. MELI $3,505.4 $3,451.5 $249.1 77.3% 35.0% 25.8% 13.9x 39.6x 11.0x 30.6x 31.3%Overstock.com, Inc. OSTK $295.4 $256.7 $1,094.8 17.4% 1.4% 8.2% 0.2x 16.2x 0.2x 10.1x -35.8%PetMed Express, Inc. PETS $233.2 $173.6 $230.9 35.0% 13.1% -2.0% 0.8x 5.8x 0.8x 7.3x -31.2%ZAGG, Inc. ZAGG $375.7 $380.7 $118.1 47.7% 18.7% 162.9% 3.2x 17.3x 2.5x 11.6x 351.5%

Median: $497.4 $460.7 $336.3 40.5% 9.4% 16.4% 1.6x 14.5x 1.4x 10.4x 45.8%









-15%

-10%

-5%

0%

5%

10%

15%

20%Internet Retail Software Stock Market Return: Jan - July 2011

Internet Retail S&P NASDAQ SEG Internet Index

SEG Internet Index Category: Search


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Baidu.com, Inc. BIDU $54,807.8 $53,260.7 $1,632.8 80.5% 56.9% 83.7% 32.6x 57.4x 19.6x 32.9x 92.9%Google Inc. GOOG $194,924.1 $161,943.1 $33,328.0 65.2% 38.4% 27.1% 4.9x 12.7x 3.9x 9.3x 24.5%IAC/InterActiveCorp IACI $3,518.2 $2,758.6 $1,810.0 62.6% 12.2% 25.1% 1.5x 12.5x 1.3x 7.2x 65.6%InfoSpace, Inc. INSP $352.9 $89.5 $238.6 35.7% 6.8% -0.1% 0.4x 5.5x 0.4x 2.9x 21.7%Local.com Corp. LOCM $73.8 $53.6 $74.9 40.8% 1.0% 2.4% 0.7x 74.7x 0.6x n/a -44.6%LookSmart, Ltd. LOOK $25.2 $4.1 $36.2 43.7% 10.5% -29.9% 0.1x 1.1x 0.1x 1.0x -2.7%ReachLocal, Inc. RLOC $531.0 $446.4 $334.5 47.1% -1.9% 35.8% 1.3x n/a 1.1x 29.7x 31.0%Sohu.com Inc. SOHU $3,450.2 $2,836.6 $710.3 73.6% 41.1% 29.6% 4.0x 9.7x 3.4x 9.8x 91.6%Yandex YNDX $11,298.2 $10,629.2 $563.0 78.4% 45.1% n/a 18.9x 41.8x 13.6x 27.6x n/a

Median: $1,990.6 $1,602.5 $522.4 54.9% 11.3% 26.1% 1.4x 12.5x 1.2x 9.3x 27.7%









-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%Internet Search Software Stock Market Return: Jan - July 2011

Internet Search S&P NASDAQ SEG Internet Index

SEG Internet Index Category: Services


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Active Networks ACTV $961.6 $1,344.9 $306.4 56.4% 7.2% n/a 4.4x 60.8x 4.0x 34.6x n/aAncestory.com ACOM $1,601.8 $1,530.8 $354.4 83.6% 33.1% 38.4% 4.3x 13.0x 3.4x 9.6x 80.4%Bankrate RATE $1,829.0 $2,334.9 $345.4 62.4% 32.0% n/a 6.8x 21.1x n/a n/a n/aeHealth, Inc. EHTH $277.0 $141.1 $161.9 81.8% 21.3% 14.2% 0.9x 4.1x 0.9x 6.4x 16.7%FriendFinder FFN $116.6 $601.9 $343.3 68.7% 32.0% 4.1% 1.8x 5.5x 1.7x 5.7x n/aJiayuan.com International DATE $449.8 $438.9 $32.5 65.7% 21.5% n/a 13.5x 62.6x 8.2x 32.5x n/aLinkedIn LNKD $9,547.2 $9,441.1 $358.5 82.7% 13.4% n/a 26.3x 197.1x 17.2x 211.0x n/aLoopNet, Inc. LOOP $746.6 $638.5 $82.1 84.1% 24.8% 9.1% 7.8x 31.3x 6.9x 19.6x 60.1%Qihoo QIHU $2,661.7 $2,669.3 $70.9 88.3% -12.7% 91.7% 37.6x n/a 18.8x 67.1x n/aRenren RENN $4,244.6 $4,464.4 $83.1 79.4% 13.4% n/a 53.7x 401.5x 32.9x n/a n/aStamps.com STMP $240.2 $203.6 $92.8 73.1% 12.6% 10.4% 2.2x 17.4x 2.0x 10.8x 53.1%Shutterfly SFLY $1,872.1 $1,796.2 $348.2 54.6% 9.5% 31.8% 5.2x 54.3x 3.3x 18.0x 116.9%VistaPrint VPRT $1,152.0 $914.9 $817.0 64.8% 17.6% 21.9% 1.1x 6.4x 0.9x 6.4x -19.2%Zillow Z $867.0 $851.5 $36.4 84.5% -8.0% n/a 23.4x n/a n/a n/a n/a

Median: $1,152.0 $1,344.9 $306.4 73.1% 17.6% 18.1% 5.2x 26.2x 3.7x 18.0x 56.6%








-10%

-5%

0%

5%

10%

15%

20%

25%Internet Services Software Stock Market Return: Jan - July 2011

Internet Services S&P NASDAQ SEG Internet Index

SEG Internet Index Category: Travel


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


Ctrip CTRP $6,618.3 $6,120.9 $494.4 78.1% 37.9% 33.6% 12.4x 32.7x 10.6x 25.3x 14.5%Expedia EXPE $8,691.2 $8,179.6 $3,642.0 79.6% 23.8% 17.4% 2.2x 9.4x 2.0x 7.5x 39.7%HomeAway AWAY $3,138.1 $3,523.3 $200.8 84.7% 17.4% n/a 17.5x 100.6x n/a n/a n/aMakeMyTrip MMYT $813.3 $749.4 $143.0 36.6% 4.1% n/a 5.2x 128.2x 8.5x 58.0x n/aOrbitz OWW $334.3 $652.7 $763.6 79.6% 14.7% 2.9% 0.9x 5.8x 0.8x 5.7x -27.7%Pricelilne PCLN $26,692.7 $25,579.9 $3,645.1 65.8% 29.1% 38.9% 7.0x 24.1x 5.8x 18.4x 139.6%Travelzoo TZOO $869.2 $828.9 $130.7 93.2% 24.6% 25.7% 6.3x 25.8x 4.7x 15.6x 239.3%

Median: $4,878.2 $4,822.1 $629.0 78.8% 20.6% 25.5% 6.1x 28.4x 5.8x 18.4x 27.1%








-15%

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-5%

0%

5%

10%

15%

20%

25%

30%

35%Internet Travel Software Stock Market Return: Jan - July 2011

Internet Travel S&P NASDAQ SEG Internet Index

SEG Internet Index Category: Video Games


Revenue

TTM Gross

Margin

TTM EBITDA Margin

TTM Revenue


EBITDAForward

EV/ Revenue

Forward EV/

EBITDA


ChangeYou CYOU $2,712.3 $2,305.9 $379.5 88.6% 64.6% 31.2% 6.1x 9.4x 5.2x 9.1x 81.2%Giant Interactive GA $1,768.6 $825.5 $239.1 87.3% 63.6% 29.7% 3.5x 5.4x 3.0x 4.8x 14.3%Netease NTES $6,596.0 $5,010.9 $892.4 67.1% 50.0% 41.0% 5.6x 11.2x 4.7x 9.5x 31.9%NCSoft KOSE:A036 $6,100.0 $6,113.1 $582.2 78.2% 36.8% -4.6% 10.5x 28.6x n/a n/a 94.1%Perfect World PWRD $994.5 $719.8 $391.9 82.0% 36.8% 9.5% 1.8x 5.0x 1.5x 4.3x -15.3%Shanda SNDA $1,978.6 $1,293.9 $906.5 59.8% n/a 8.9% 1.4x n/a 1.1x 6.3x -12.3%Tencent Holdings SEHK:700 $47,509.9 $45,127.1 $3,685.0 66.3% 49.4% 49.4% 12.2x 24.8x n/a n/a 35.0%

Median: $2,712.3 $2,305.9 $582.2 78.2% 49.7% 29.7% 5.6x 10.3x 3.0x 6.3x 31.9%








-5%

0%

5%

10%

15%

20%

25%

30%

35%Internet Video Games Software Stock Market Return: Jan - July 2011

Internet Video Games S&P NASDAQ SEG Internet Index

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