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Mentor Graphics Corp. Message Board

  • baumanncynde baumanncynde Feb 8, 2011 2:02 PM Flag


    Cdns made an offer for 14.50/sh. Durings the recession and ment refused for reason of undervalued offer. Now with ichan and other funds buying ment should be between 18.00 to 24.00 share/

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    • Good question. Don't know the exact numbers. It may be in the 10K.

      Most EDA vendors have some reseller business, but it is usually for the lower-end "Shrink wrapped" products. MENT uses VAR's for the PADS and other similar product lines.

      AutoDesk is definitely a higher percentage as you point out.

      Interesting question though, I'll try to look at the 10K's later.

    • Got it. Quick question. Do you guys know what percentage of sales is direct vs var? And if the costs associated with var channel needs to be trimmed.

      I understand that ADSK's var channel costs are ridiculously high. But their entire sales model is centered around their var channel I believe. Is that why their SG&A is so high?

    • Thanks for the numbers. Now it all looks normal.

    • Stockmeister - look at the data before you make claims like this.

      One of the leading MCAD companies is AutoDesk and for thier last reported year ending Jan 31, 2010 they had revenues of $1.7B and SG&A of $930M. That is 54% - notably higher than MENT and CDNS.

      Just noticed born.giantsfan comment here too. You asked for the comparison, you got it.

      You need to realize that for selling highly technical software into new customers, you need a staff on the ground working with the customers. You are assuming it is a bunch of over-paid sales people and are ignoring the large staff of Application Engineers these companies need out there.

      This isn't a shrink-wrapped software industry like MSFT. You can't go into Costco and buy Mentor software.

      SNPS has cut in this area and also has the luxery of several "cash-cow" products that have little competition. So thier SG&A numbers are lower. On the other hand, their revenues grew only 2% YoY.

      MENT on the other hand is growing 12% YoY.

      So if MENT sales models is broken, how are they growing revenue at a faster pace than either SNPS or CDNS?

    • MCAD:

      - AutoDesk (ADSK) in Q3
      - Rev - $476.7M
      - SG&A - $236.2M (49.5% of revenue vs 44% for MENT)
      - Mark&Sales - $185.1M (39% of rev vs 33% for MENT)
      - numbers are worse than MENT

      - SolidWorks
      - now owned by Dassault so numbers aren't as clear since Dessault has other product areas. For the parent company
      - SG&A is about 40% of Rev
      - Mark&Sales is about 31%
      - slightly better than MENT

      Want more?

      Basically your claims are completely unjustified. MENT is not that out of line for SG&A in technical software. Yes, trim costs a little more, but if they do too much sales will flatten.

      SNPS has better numbers, but sale only grew 2% last year. MENT is growing 12%.

      Put some data behind your claims.

    • Both CDNS and MENT sales models are broken. Look, the fight for market share with tremendous costs doesn't make sense. All I am saying is a $300M for a $900 rev is just wrong. Way out of control. Compare that with the other sectors? How about the MCAD tools?

    • Stockmeister---can you please stop calling every person you reply to idiots or retarded--it is offensive and abusive, and there really is no need for those sort of comments. Thank you

    • I think you are correct. And it is a trade-off the company has to make. SNPS for example has been cutting in this area - Mark&sales was $340M last year, only 10% higher than MENT and CDNS. That is what shareholders like.

      On the other hand, as a EDA customer I can tell you that I never see our SNPS and CDNS AE's anymore. They have been cut back and laid off or they haven't increased in numbers as the customer base has grown.

      But our MENT AE's are here almost every week and always return our calls in a day.

      So what is good for the shareholders may not be good for the customers. The question is, will SNPS cutting costs in this area hurt them in the long run and will MENT's investment help them?

      In the latest earnings call SNPS grew 2% YOY. If MENT comes in at "only" $900M, MENT will have grown revenue 12% YOY.

      12% vs 2%. hmmmm

      Sounds like MENT management knows what they are doing.

    • what a total crock. ooooh, icahn owns stock in the company and now, since his name is icahn, he can flex his muscle. let me understand this ... he bought stock in this company and didn't know the management team???? or did he buy it with the intent to manipulate it with antics such as these? this all reeks of inappropriateness. icahn will be investigated and may end up spending time in jail over this.

      • 1 Reply to bagholder11
      • You must be a total retard...Questioning an inefficient management and high cost of sales is a shareholder right. With 15% he has every right to fix this company. Anyone who things otherwise is plain stupid...

        This management really sux. Bunch of old farts, riding into sunset, living off of company money, spend like kings wherever they travel. $300M for marketing and sales??? Come on...

        It's about time the axe fell on the dead wood. Chop, chop, chop...

    • CDNS made an offer for $16 in June 2008. Mentor rejected it.

      This is a $20+ stock. No reason for this to be trading in the teens. The biggest issue with Mentor is their cost of sale. If they can bring down the cost of sale then this company can generate tremendous amount of cash every qtr. Problem is mgmt pays themselves and leaves very less for the shareholder.

      Not any more. Investors like Icahn and other are on to the management. Their days are numbered...Count on it!!!

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