bull, I don't know why I keep responding to you, since you seem incapable of dealing with facts. But here goes.
Cooked books? You say you haven't seen the reserves held back for the "millions" of Zip drives sold in the third quarter?
1 - Nobody ever claimed that they sold "millions" of drives.
2 - Rebates for Q3 Zip sales were partially offset by reserves held back from Q2.
3 - Here's a quote from the Motley Fool summary of the conference call. "On receivables, DSO at Q3 1996 stayed flat at 57 days with Q2 1996 while net receivable dollars grew from $180 million to $198 million. Their bad debt reserve amounted to $7.7 million or 3.4% of gross receivables, up from $6.6 million in Q2 which also represented about 3.4$ of gross receivables. Their other receivable reserve amounts to $23.3 million or 10.1% of gross receivables, up from $7.3 million or 3.7% in Q2 1996. Volume rebates due to the volume growth in Q3 plus the price rebate program for Zip in Q3 and that announced for the fourth quarter drove the increase in the reserve."
There you are. Reserves have been increased to 23.3 million. These figures are verifiable from the press release.
4 - If they wanted to "cook the books" to increase EPS, then why did they pay for the majority of the Penang plant purchase and retooling with cash? Here's another quote from the MF conference call summary:
"During the third quarter the company had negative cash flow of $73 million including $4.4 million used to repurchase 300,000 shares of common stock. The majority of this cash usage can be attributed to additional investment in plant and equipment of $49 million including a non-recurring $28 million acquisition of their Penang manufacturing facility and the $32 million seasonal buildup of inventory. To meet the $73 million cash needs this quarter, they drew down their cash balance by $58 million, leaving about $103 million in cash and added $15 million in new debt, primarily in the form of long-term seller financing of the Penang facility. Their $100 million revolving credit facility with Wells Fargo Bank remains completely unutilized and fully available."
bull, just admit that you were totally off base with your silly drivel about the huge bucks you were going to make shorting Iomega.
And hey, here's a thought. Let's ask Schwab why there are no shares available to short. Could it be simply because there are already too many people short? Or maybe it's because the stock will be moving to another market in a few weeks?
(bull thinks, "Sure we could investigate to find out why no shares are available. But heck no, let's not try to find out the facts, let's just fling a lot of hysterical bull about it. Maybe we can start a stampede.")
bull, I hope you don't plan on using that strategy. You can influence other people only if you have some shred of credibility.
- Allen |
