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Non-Tech : Tyco International Limited (TYC) -- Ignore unavailable to you. Want to Upgrade?

To: Director who wrote (312)	10/21/1999 6:41:00 PM
From: KAF	Respond to of 3770

21 Oct 15:50 Bear Stearns analyst Inch noted Tyco had indicated before Thursday's results that it was likely to beat analysts' estimates. So the better-than-expected fiscal fourth-quarter results announced Thursday may already have been taken into account in the stock price. They were "very robust results, in keeping with the Tyco tradition," Inch said. "I think it was a very solid, exceptional quarter. All of the trend items were moving in the right direction." He believes analysts estimates for 2000 are likely to move up "probably on the order of 5 cents," he said. If that happens, it would raise the First Call/Thomson Financial consensus estimate to about $4.21 a share from the current level of $4.16 a share for 2000. "I'm at $4.20," Inch said. "I'm certainly looking to put them closer to $4.25." Credit Lyonnais analyst Amaturo doesn't think estimates will be revised significantly, but he is bullish on the stock because he thinks the price has been depressed by accounting concerns. "The multiple's pretty low on 2000 numbers," he said. With earnings of $4.16 expected for 2000, and a stock price of about 86, the price-to-earnings multiple is about 21. But since earnings per share are expected to grow 36% next year, he thinks a "fairer multiple is probably in the very high 20s to 30." He has a $130 price target for the stock. Amaturo is not alone in liking the stock. In a daily tabulation of the highest and lowest-ranked stocks in the diversified industries category, Tyco ranked the highest on Thursday, according to surveys of analysts by First Call. Management, Amaturo said, "is on the up and up. This is a first-class management team. They always beat expectations." Merrill Lynch's Young said he has followed the company for 10 years and it has always been conservative and done nothing to raise suspicion. "It's a very strong company. They like to buy undermanaged companies," he said. Tyco has four units - telecommunications and electronics, fire and security services, health care and specialty products, and flow-control products. -Tom Locke; Dow Jones Newswires; 303-293-9294

To: Director who wrote (312)	10/21/1999 6:44:00 PM
From: KAF	Respond to of 3770

21 Oct 15:18 By Tom Locke DENVER (Dow Jones)--Tyco International Ltd.'s (TYC) fiscal fourth-quarter results announced Thursday were strong, analysts said. The Hamilton, Bermuda, diversified manufacturing and service company reported per-share earnings, before extraordinary items, of 92 cents, on sales of $6.22 billion, for the fiscal fourth quarter ended Sept. 30. That compares with earnings of 25 cents a share on sales of $5.11 billion for the year-ago quarter. "Tyco International had a great quarter - high-quality earnings with very strong free-cash-flow generation," said Merrill Lynch analyst Phua Young. "It looks like there was strength across the board. Good internal growth. And we continue to like the stock." One factor making the earnings look so much better in this year's fiscal fourth quarter than last year's fiscal fourth quarter was the restatement of results in last year's fourth quarter to include the pooling-of-interests acquisitions of U.S. Surgical Corp. (in mid-1998) and AMP Inc. (in April), said Young. The poorer pre-acquisition performance of those companies was incorporated into Tyco's year-ago restated results. But per-share earnings also looked good compared with the First Call/Thomson Financial consensus estimate of 89 cents for the quarter, beating the consensus by three cents a share. That was largely because profit margins in the company's telecommunications and electronics unit came in ahead of expectations, said Young and Credit Lyonnais Securities analyst Joseph Amaturo. "One of the more compelling issues is the telecom and electronics segment profit margin coming in so nicely," Amaturo said. Tyco reported a 22.9% profit margin in that segment, said Amaturo, compared with his expectations of margins in the "high 19s." Young said the most important aspect of the results were free cash flow of more than $900 million for the quarter, which was a record. "The key thing is that the cash was there," Young said. "The cash is there to back up the earnings. That should give investors confidence that the earnings are of high quality." Young was referring to doubts that have been raised about whether Tyco's accounting has artificially inflated its earnings. But all three analysts contacted by Dow Jones Newswires said that they don't believe there are any irregularities in Tyco's accounting practices. Tyco's stock has taken a beating since Oct. 13, largely because of investor concerns about the company's accounting practices after they were questioned in a report by Albert Meyer, of the Dallas investment firm of David W. Tice Associates. "I firmly believe Tyco's accounting is completely above-board," said Bear Stearns analyst John Inch. "We have gone through their numbers with a fine-tooth comb." Nevertheless, Inch thinks investor uncertainty is still hurting the stock's price. Tyco shares closed at 103 3/8 on Oct. 12. They were recently trading down 2 3/8, or 2.7%, at 86, on volume of 5.5 million shares compared with average daily volume of 3.8 million shares. Young said the stock drop Thursday might be attributed to the drop in the market as a whole as well as possible continued moves by portfolio managers to be prudent in light of the accounting concerns. He also noted the stock traded up Wednesday, when it rose 4.6%, probably in anticipation of a favorable earnings release Thursday. Tyco senior vice president J. Brad McGee couldn't be reached for comment. (MORE) DOW JONES NEWS 10-21-99 03:18 PM