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Strategies & Market Trends : Making Money is Main Objective

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To: Softechie who wrote (571)	1/22/2001 5:09:46 PM
From: Londo	Read Replies (1) of 2155

CNC was already the miracle of the decade.. although quite frankly, I never wrote that company off. Lets see here with WAC.. a company with 1.6 billion in debt, increased from 1.1 billion the beginning of this year.. that managed to dump 170 million of inventory and only managed to increase cash from 9 million to 36 million (in all fairness, payables are down from 600 million to 320 million, but that's what the LT debt paid for).. that increased operating expenses 50% from the previous quarter last time around.. Yet they still managed to pay a 9 cent dividend.. sure. This is a telltale sign of horrible management. Oh, did I mention that they bought back 12.1 million shares of stock at an average 26 dollars a piece.. I guess they didn't see the avalanche coming? With gross margins dropping like a stone (35% to 11%), $160 million worth of cash interest payments due each year.. plus since that debt expires August 2002, they've got exactly 18 months to pray to whatever deities they have before you can stick a fork on this one. At least with FNV you've got a 5% chance of the phoenix rising out of the ashes.

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