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To: pater tenebrarum who wrote (26198)	10/10/2000 10:26:31 AM
From: Perspective	Read Replies (1) \| Respond to of 436258

<the amount of tax credits in both cases is equal or surpasses net profits. in other words, no stock options exercises, no profit. > Untrue. Common misconception, one that I held myself. Though they paid no tax, they aren't claiming that benefit in their earnings per share. Not even the ones polished for the public. It shows up only on the cash flow statements. I figured the same was true of their vendor financing arrangements - probably a misconception overblown by Fleck and others. They'd have lousy cash flow if they were accepting significant amounts of stock instead of cash payment. To my amazement, it's true. Their cash flow sucks. If you back out option exercises, their cash flow is less than half of their income, so their price-to-cash flow is more than double their PE. I guess when option exercises fix the cash flow problem, you don't really care if you take on equity instead of cash sales. I wonder how their attitude is changing now that option exercises are tailing off and their equity "investments" are turning sour? <ggg> BC [PS I had a detailed post on this issue weeks ago; might be able to dig it out again if you'd like]