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Strategies & Market Trends : Value Investing
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To: jeffbas who wrote (6015)2/10/1999 9:05:00 AM
From: Mike 2.0  Read Replies (1) of 78794
 
Jeffrey, would TMO look better to you if they do go ahead and completely divest companies not carrying their weight? For example I would like to see them jettison companies like ThermoLase. If you read their boilerplate paragraph explaining the co's business without knowing the name of the company one may well peg it as a BB stock.

BTW, I spoke with IR yesterday. The rep said that most of the company's problems have been self-inflicted, referring to structural issues, but they know what the trouble spots are and are addressing them. He said expect a structuring announcement related to Thermedics in April. Restructuring should be finished by end of year or September (sorry can't recall if he said one or the other or both). He also conceded the restructuring has taken a long time; he speculated that may be why stock has gone from 20 to 15 recently. He added Asia exposure is appx 15%. Plus usual things you'd expect from an IR dept worth its salt: the NAV of companies and cash clearly indicate TMO is undervalued, mgt. is excellent, etc.

My take is 11-12x earnings for a restructuring company expected to underperform for the next 12 months is fair valuation. Given expected 1999 earnings of 1.20, and _assuming_ they don't miss their numbers, I suspect this stock will languish in the $13-15 range this year.
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