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Technology Stocks : Network Associates (NET)

NET 210.59

-1.4%

Nov 14 9:30 AM EST

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To: Chuzzlewit who wrote (4164)	2/4/1999 2:09:00 PM
From: Charlie Smith	Read Replies (2) of 6021

Chuzz, Right again. You can probably find the pro-forma numbers for NETA ex those acquisitions somewhere in the financials if you dig, but I'm not sure you'll add anything to the argument. The point of all this is that a company can wildly overpay for an acquisition, and the accounting rules are such that the overpayment can be hidden for years afterward, perhaps FOREVER if the acquisitions continue. IMO, dollars of revenue added per dollar of acquisition cost make a good starting point for analyzing these purchases. From there it gets much trickier to figure earnings dilution, but it can be done. Charlie

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