How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 493.80

-2.7%

Nov 18 3:59 PM EST

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To: 16yearcycle who wrote (21059)	4/20/1999 11:01:00 PM
From: Exacctnt	Read Replies (2) of 74651

Eugene, <<< They have 21.7 in cash alright, but they also have 7.4 billion in "equity investments." So the total is 29.1 billion. At 10% per year, they would generate 2.9 billion or about 750 million a quarter, so the 750 is in fact sustainable, and will increase.>>> The 750 is not sustainable. You cannot lump the 7.4B in Equity Investments with Cash and Cash Equivalents. They are long term investments and only contribute to earnings when they are sold or maybe, but unlikely, if they pay dividends. Microsoft really streamlines their financial reports. The Investment Income line on their Income Statement includes Interest Income and Gains from the sale of Investments. The reported 720M Investment Income includes 350M of Gains from the sale of Investments. That leaves 370M of Investment Income presumably from interest on the Cash and Cash Equivalents balance. The 370M is the amount that directly relates to a rising or declining Cash balance. Regards, Bob

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