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Strategies & Market Trends : Value Investing

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To: Spekulatius who wrote (38234)	6/9/2010 8:37:57 AM
From: Jurgis Bekepuris	Read Replies (1) of 78602

First of all, they changed the press release to read "incremental net income" and not "revenue" (and you quoted the changed release!!!), so your calculations are no longer valid. With the change, they are getting $2.4M income for $13.9M purchase price = 17% earnings yield, which is great. Unbelievable but great. :) Even if we went with original wording and your calculations, they would be buying 4.5% earnings yield on purchase price, which is not great, but also not horrible. There are tons of businesses trading and acquired at worse earnings yield. So I am not sure why the outrage?

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