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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: MythMan who wrote (225821)3/6/2003 11:30:23 AM
From: reaper  Read Replies (1) of 436258
 
how do you even guess; a large portion of their business / cash flow is now a wasting asset.

i don't have the cash flow statement for the full YEAR yet, but for the nine months they did cash from ops of $1.5 billion, which was DOWN <15%> from $1.8 billion in the first nine months of 2001. so that's $2 billion or so annualized. but, they're talking about only earning a buck in 2003, so presumably that cash flow is gonna fall again, maybe to only $1.5 billion or so?? (anybody know how much profitability from Claratin and PEG-Intron??)

they spend about $600-700mm a year on capex; i frankly don't know if they can cut that but their capex has actually GROWN so far this year despite the shrinking revenue and cash flow which indicates that it is more of a baseline number.

so free cash each year is maybe a $billion or so? note that they pay out $1 billion a year in dividends, so there MIGHT be a divvie cut coming.

i don't know, i can't get psyched about paying $23 billion market cap for a business that generates $1 billion in free cash a year. of course, this is not giving them much if any credit for whatever pipeline they might have.

note that the defense companies (which were supposed to be a safe haven in the bear market -- not!) are trading now at about 10-15x free cash. i'd say the growth prospects for Raytheon and Northrop are getter than those for SGP, but what do i know.

no, i am not short any more; haven't been for weeks. am still short Lilly, Glaxo and Pfizer, plus some small bios.

how's F doing these days, btw <g>

Cheers
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