Forum Archive Index - August 2001

["Peter" <pmaiden@xtra.co.nz>]

Thanks Ben - I've always enjoyed Christpher Byron's articles and that was one of his better ones.

 

I liked the paragraph -

What kind of operating business does the company have to show for all this? Frankly, it’s got bubkes. Just two customers—Lucent Technologies Inc. and Nortel Networks—account for a full 25 percent of JDS Uniphase’s business, and they’re in as bad shape as JDSU is. It’s like three drunks all leaning against each other to stand up.

 

A while ago he also did a very good piece on the current treatment of goodwill

 

Sara Lee Is Buying Stale, Overcooked Earthgrains Stock

http://www.observer.com/pages/story.asp?ID=4554

 

An excerpt will get you all to want to read the article -

 

Want an example? Then look no further than a deal announced on July 2 between the Chicago-based Sara Lee Corporation and an outfit in St. Louis named the Earthgrains Company, which makes, among other things, what I suppose you might call bread for yuppies (croissants and whatnot). Whatever you call it, Sara Lee is paying a stunning 133-plus times current earnings for the company, and will enjoy an immediate boost of perhaps as much as 8 cents per share to its earnings in the year ahead as a result–all this without ever having to reduce its reported net income by the offsetting 5 cents per share that earlier accounting rules would have required.

 

Cheers

 

Peter