Alex,
Thank you for the sites. I have not come across those previously and they look like they have some good information. I bookmarked them.
Regarding, ANET's book value and cash level, there is no doubt that acquisitions can have a negative impact on the acquirer's earnings. Although, I need to read more about whom they have acquired, my guess is that ANET was paying for the technology of these companies. Once acquired, there are probably things on the balance sheet of these companies that need to be addressed (such as product inventory that cannot be sold, uncollectable receivables, etc). Once again, my guess is that ANET is taking care of this business now and perhaps it is more than was anticipated when the acquisition was made. I have not read the 10Q but if it is true that frame relay sales are good then ANET should begin to offset these acquisition costs with margin from its product sales (IMHO).
Have a great day,
Paul Haynes |
