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Strategies & Market Trends : Value Investing

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To: TimbaBear who wrote (12060)	2/17/2001 3:39:54 PM
From: rjm2	Read Replies (1) of 78702

If it has a nagative net worth, then it simply makes it an even bigger EARNINGS play because if you count the goodwill as worthless, then you also have to remove the amortization of that goodwill from the income statement. I believe in some instances,goodwill & the amortization therefrom, masks the underlying earnings power. I often question the value of goodwill, nothing wrong with that, but it comes down to...what would you give for a business earning X ? There are a whole lot of busineses earning nice money with negative net worths or moutains of goodwill. CLHBs book value has decreased a lot over the years, much of that due to amortization of goodwill. Insiders have a history of buying over the years and the safety Kleen fisaco is really helping them. There comes a time in a value investors life when owning piece of junk assets in businesses that cant earn a decent return gets old. Off topic, ROSD which I mentioned here is up nicely. My fear kept me from really loading up when it fell to 25 cents, but I own a chunk at 60 cents average from a few months ago. Its back to $1 and still cheap.

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