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Strategies & Market Trends : Value Investing

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To: MCsweet who wrote (25400)	11/29/2006 10:04:13 PM
From: Paul Senior	Read Replies (1) of 78753

Maybe another way to look at SCMR p/sales ratio is to separate the company's value into two parts --- (1)the cash component and (2) the business part that generates the sales. P/sales number, instead of being 3.70/sales per share, becomes (3.70-3.20)/sales per share. That is a lot lower number than 11 and maybe provide a more realistic measure of what p/sales is for the business aspect of SCMR. (Just a rough number because I assume the business does require some cash, so not all of the $3.20/sh cash component can be subtracted out.)

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