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Technology Stocks : Westell WSTL

WSTL 6.020

+0.3%

Nov 28 9:30 AM EST

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To: RockyBalboa who wrote (20166)	8/18/2000 10:20:11 PM
From: BWAC	Read Replies (1) of 21342

Oh great, yet another financial statement analysis guru. Are you the Friday night reinforcement from the gold digger camp? Are you a professional broker as well? And no I hope not to be here much longer. I have no position whatsoever in WSTL. I stopped in to set the record straight regarding the misapplied financial comments that were being posted by certain people seemingly trying to further some sort of a negative agenda. As far as cash, no cash, needing more cash. WSTL carries very little long term debt. They overall have very little debt on the balance sheet. One could conclude that they do manage their cash well. And one could conclude that they haven't been making many visits to the banker. Also note that they didn't incur substantial debt to ramp up their production and inventory levels. Imagine that? See right now this quarter because of the incredible sequential increase in sales quarter over quarter, all the cash flow is tied up in Accounts Receivable and Inventory. (Think with me now. I know this is difficult material) See results in the Statement of Cash Flows depend greatly upon the increase/decreases between certain accounts. For instance fast forward to next quarter and assume sales only increase modestly. Receivables will only increase modestly. Inventories will only increase modestly. And conversely these items in the cash flow statement will not show such large increase numbers. Watch cash flow magically appear. Almost out of thin air. Why? Because its cash flows. A lagging indicator. Cash from sales last quarter hasn't flowed in. Its receivable. When it is received that will reflect on this current quarter. In sum, the statement of cash flows is basically useless when a company achieves a huge sales ramp. You do understand this right?

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