Earthling, Shaw, et al,
Some great posts here. It is always good to get many different perspectives. I am just thinking out loud, specifically regarding your post Earthling. Adobe already gives away the Acrobat reader software free, what if they allowed Microsoft to bundle it with their new Windows 98 o/s, as well as NT!
Also worth thinking about, when does consistent non-normalized earnings begin to be included in the normalized earnings? What if Adobe consistently included $.10-.20/share of non-normalized earnings? After a few years of this eventually somebody will begin to notice and include it in their valuation. Ofcourse, the fact that they haven't, is the reason for the stock dividend program. Adobe mgmt is trying somehow to give value to the shareholders from their astute venture capital program. As far as I am concerned, even if these earnings are not included in multiple valuations, it still increases the enourmous cash position of this company, which is a definite plus. Conversely, you can be sure if they had $.10-.20 per share of non-normalized LOSSES the analysts would be including that in their valuations, as they should, especially if the losses were eating up cash.
Let's not forget the stock buyback program. The reason for the stock buy back program as mgmt stated is for one reason only, and that is to help increase stock price, and vis a vis, stock holder value. With their writing of put options in the past, I believe they will use this program astutely to bring about their objective. I would hate to be short this stock.
Lastly, in the conference call they stated they have new products which will be introduced, and I agree with Earthling, that those products will be in enterprise document handling. Huge market potential. And their successful application migration to Windows has positioned them well to capatalize on this market. Now if they can get Microsoft to bundle Acrobat with their o/s...
Just some thoughts.
Jeff |
