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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: James Clarke who wrote (8172)	9/7/1999 11:24:00 PM
From: Michael Burry	Respond to of 78842

McKesson to me has limited visibility. They're a middle man and can be squeezed pretty severely. With Medicare coverage of drugs, prescription prices are the next target, and I don't see middlemen prospering in this environment. Their size is the wild card, but it's no certainty. It's a low return on equity, low return on assets game. Drug distributors and PPM's just don't make much sense to me now. Neither does health care software. HealthSouth has been on an acquisition binge because they had to be. I don't see this as an ego-driven spree, but rather one necessitated by the changing dynamics that require big negotiators. They to me are positioned in the areas that a)make the most sense economically - rehab is a high return on investment for the payor, and they will sooner or later realize this and b)have the most sympathy at HCFA. HealthSouth has a good reputation as managers in my understanding. As always, new lows and I'm out until another base is formed. But for now looks like a low risk play. Mike