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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (7518)6/9/1999 11:38:00 PM
From: Michael Burry  Read Replies (1) of 78666
 
I don't see 17% either, but you switched to "return on capital"

That's because there's other owners who have a claim on the company - its bondholders. It's folly to use simple ROE to compare companies with different capital structures (i.e. different debt/equity ratios).

IMO, if you are going to be determined to use ROE of 16% despite the debt, no one's going to stop you. Certainly not the people that want to sell you their shares.

Mike
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