To all: Found this on the DJ News Service. Best, Joe
-------------------------------------------------------------
01/28 11:44A (DJ) =Stovall: Stk Gains Enable More Cos To Use Stk As Currency
Story 4748 (COMS-D, COMS, CSCO-D, CSCO, DELC-D, DELL, INTC-D, INTC, MSFT...)
NEW YORK (Dow Jones)--The sharp gains in some share prices are making it
easier for companies to use stock as acquisition currency, said
Stovall/Twenty-First Advisers' President Robert Stovall.
"If stock prices weren't as high as they are, particularly in the technology
sector, you wouldn't sees companies making acquisitions using their own shares
as currency," Stovall told CNBC Thursday.
The accounting of acquisitions may also be masking problems in a company's
balance sheet.
"They are using their stock, in part to make acquisitions, to focus the
attention of investors and the competition on increasing the top-line of their
sales. And they can explain away disappointments in the bottom-line for a
while as they make write-offs," Stovall explained.
Stovall recommends investing in blue-chips that pay up for their earnings.
Stovall likes Cisco Systems Inc. (CSCO), 3Com Corp. (COMS), Intel Corp.
(INTC), Dell Computer Corp. (DELL) and Microsoft Corp. (MSFT).
"Don't bottom fish," Stovall added.
- Jessica Madore Fitch; 201-938-5172
(END) DOW JONES NEWS 01-28-99
11:44 AM |
