"Clearly debt has not been your concern . . ." Oh yes, debt is definitely one of my concerns. The more debt, the greater the downside risk if earnings stagnate, or worse, decline, because high debt service costs eat up earnings in a hurry. The actions, or purported actions of CFIUS, which didn't actually take action, were more political in nature, and not altogether different from what many other countries, including China, do in order to send a message concerning their likes or dislikes.
With WDC stock just above its lowest level in over three years, yes, the probability of going lower is near zero. The probability of going up, even with the high debt, is much greater when the stock sells at less than $37. And Unispendour [sp?] now has an opportunity to take a 15% position in WDC at much lower cost. And yes, with that much ownership, or possibly even less than 15%, they can still get a seat on the board, which is ok with me.
I do not have what you label an "anti-Chinese stance." But I do have a lot of stock in Chinese companies, and I do have a lot of experience seeing how the Chinese government treats foreign investors. As an example, take a look at the issues between Sinovel and AMSC, which have been percolating for several years. Sinovel stole proprietary information from an AMSC employee in Austria. The employee was arrested, tried, convicted, and jailed for his acts, but Sinovel, which stopped buying equipment from AMSC immediately after getting the proprietary information, has lost nothing. Several lawsuits claiming damages above $1 billion are stuck in Chinese courts. Some that were dismissed have been reinstated on appeal, but there is no resolution over what is clearly a crime by Chinese and international standards. Yes, that gives me a certain amount of concern when I invest in China. And by the way, I have held stock in Chinese companies for the better part of 20 years.
I also have worked for many years in southeast Asia, speak Bahasa Indonesia, and have numerous Chinese friends and acquaintances. When I invest, I do not invest with cultural bias, but I do look closely at fundamentals.
Art |
