chic
As for cooking the books, I don't think so...Intel is way too visible to be doing sh*t like that
I'm not suggesting they are doing anything illegal. I'm just suggesting the style used to report earnings distorts the truth, the same thing that was suggested by Barron's.
The term "cooking the books" usually infers illegal activity.
You need to check the credentials of the posters on the threads Eric mentioned who are making these claims
They are ALL accountants. This is irrelavent though, I make my own decisions and know how to read a financial statement for myself. We all just happen to share the same opinions, same as all of the AMD supporters. Do I really know if Scumbria, Kash, Petz, Milo, Mani, or you are really who you say you are? Do I really know if any of you know jack about processors? Of course not, I make my own decisions as I think everyone else does as well.
Good!
You make the assumption that Intel will stop trading stock next year
No I'm not. I'm assuming they won't be able to repeat the same gains as the first two quarters. If I remember right, Intel only has $.65 of unrealized gains left. Some of that will be used the rest of this year.
What are those factors that have convinced you that they will not continue to make the same gains going forward?
Ultimately, is this what you really want your high tech investments to depend on? I don't, if Intel's investments don't perform well, earnings next year will suck. Even if the "core" business performs beautifully, they could have earnings down YoY, which will be bad for the stock even though it shouldn't be.
I want the company that I invest in to perform...to make their numbers quarter after quarter. If they make those numbers selling chips or pimping on Hennepin Avenue, I don't care.
And just for the record, every successful company, big or small, that has surplus cash invests that cash in some form of paper....cd's, bond, equities etc. Intel has chosen to be aggressive with some of their surplus cash, and they have been successful at it. They are to be commended.
Isn't this why financial companies don't trade with P/e's like Intel's?
Intel trades at a premium for a whole host of reasons that don't have a lot to do with their current financials. They are a Dow component, they are a part of the Naz composite, I think they are on the S&P, they are a major holding of many funds, they are a sector leader and at the bottom of all of that, they have been extremely successful
for more then 10 years......they are the best of the best.....and you are hearing this from an AMD long. To think otherwise is to deceive yourself. And they will fall only if they start to screw up seriously and they are nowhere near doing that.
As for CSCO, what is going on here...are these posters suffering from some kind of tech penis envy
No we aren't suffering "tech penis envy", we just look at the reported financial statements directly from Cisco, which speak for themselves.
Here's what stood out of Cisco's earnings to me. For one, shares increased from 7.2 billion to 7.5 billion. 300,000,000 shares added at today's price is $20 billion in market cap, or more than trailing 12 months REVENUES. In my opinion, this is a form of monetizing shareholder ignorance.
CSCO, too, is a sector leader and trades at a premium; however, like I said before, its valuation has gotten ahead of itself and the markets have responded accordingly...no more splits for CSCO for a while.
The other thing that stuck out was revenues and OPERATING profit. Directly from Cisco's condensed consolidated statements of operations, revenues ending July 1999 were $3,558,000,000 and ending July 2000 were $5,720,000,000. These are great numbers, up about 60% YoY. Also directly from the same statement we see that operating profit ending July 1999 was $853,000,000 and ending July 2000 was $822,000,000. Operating profits were DOWN YoY. So where did the big profit gains that Cisco reported come from?
Yes, I said their margins had slipped quarter to quarter. They are still good margins, so what's your point? Much better than AMD's btw.
Well from the same statement we see that "Net gains realized on minority investments" was up $344,000,000 YoY. Also, "Interest and other income" was up $104,000,000 YoY.
Most successful companies invest their surplus cash...I would sell my shares if they didn't.
Also, Cisco's effective tax rate declined YoY because of the way they are allowed to account for aquisitions and employee stock options. I think this should be of grave concern for any Cisco investor as they can sell 60% more product, but need investment gains and tax tricks just to show an improving profit.
CSCO grows in part thru acquisitions. There is some disagreement on how companies should handle their acquisition costs in their financial statements. Most companies treat those expenses like CSCO does. I am not sure who has jurisdiction in this area, the SEC or GAARP but as I understand it, until the rules are changed, they can continue to treat these costs accordingly.
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