Dow Jones on the Bear Stearns interview...
From Yahoo Chat, unverified, but it correlates with my impressions of the CNBC interview, DJ's source:
<<Dec 15:31
NEW YORK (Dow Jones)--Wall Street has got it wrong, says Bear Stearns Managing Director John Inch. The run on Tyco International Ltd.'s (TYC) stock, following the company's disclosure that the Securities and Exchange Commission has launched an informal investigation of its accounting practices, is overblown.
The company's shares recently lost 9 11/16, or 27%, to trade at 26 1/2 on volume of 83.4 million. Average daily volume is 12.5 million.
"The market has completely overreacted to this (news)," said Inch in a CNBC interview Thursday. "Investors, frankly, should not have been surprised that the SEC is conducting this informal inquiry."
A fire storm over Tyco's accounting began in October when Dallas-based money manager David Tice published a report questioning Tyco's practices.
"I think this is going to clear the cloud that's hung over Tyco once and for all," said Inch, who thinks Tice's allegations of irregularities were unfounded.
Inch said investors are concerned about Tyco's accounting practices mainly as they relate to analysts' current difficulties in assessing the viability of Tyco's businesses and recent acquisitions.
Free cash flow is the acid test Inch uses to show that Tyco's business strategy is working. The company will generate almost $80 million in free cash this quarter, compared with a $600 million loss last year, he said.
Inch thinks the stock will rebound early in the new year.>>
Best wishes,
Tom
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