Robert,
I appreciate all of the continued help in monitoring VARL. As far as ROE goes, it is still used as a traditional measure of mgmt. performance. However, many analysts are veering away from it because of its ability to be maniulated. NET INC/BOOK VAL. (the numerator is constantly being "fudged" by various companies). Bad debt, lifo/fifo, dipping into backlog, the list of possibilities are endless (this is theoretical, I'm not accusing VARL of anything).
FYI, some use Tobin's Q-ratio approximated by (BV + mkt val. of pref'ds+ mkt val. of common)/ (tot. assets). It's essentially the inverse of Price/Book. So if a company has a low price to book value, it is usually a "bargain". However this also means that mgmt. hasn't "performed".
Anyway, it seems the Street likes the #'s so far, I'm hopeful they like the CC. I guess will know tomorrow. |
