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Technology Stocks : Corel Corp.

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To: Dr. J who wrote (322)5/21/1997 7:43:00 PM
From: zigler   of 9798
 
By your judgment Corel is worth $134 million (using 60 million outstanding shares, @$2.23 per share no options would be converted to shares) or put it another way you would be able to purchase Corel with 1.4 years worth of Corel's current cash flow (profit plus depreciation & amortization). This would be the steel of the century.

I think we must be running out of things to discuss on this thread when we start evaluating companies based on "free cashflow". What is "free cashflow" anyways. There is nothing unusual about Corel's decision to use its cashflow to invest back in the company. Most companies do not have any "free cashflow" because they all just about always have some place to invest the excess cash to improve their products, profitability or a combination of the two. Based on your analysis most companies are therfore worthless. I wonder what GM's free cashflow is? I bet if you did the math you would find out GM is worth $5 per share.
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