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

To: Dale Baker who wrote (2850)	6/4/2001 12:36:45 PM
From: Moominoid	Respond to of 4691

SJR is a communications company - you can be sure WEB measured it by cash flow, debt and subscribers. Conventional PE's are distorted by the high level of amortization on the physical plant. As you say, EBITDA is a lot higher than earnings than is typical: biz.yahoo.com But they aren't taking this one over and the dividend is 3c and I don't see why there would be capital appreciation. Even in EBITDA terms the return on assets and equity wouldn't be too high. According to "Buffetology" stocks with high depreciation (of physical assets) are a bad thing though amortization of intangibles is irrelevant. No? As I understood it, in the past Buffett did invest in some stocks with high depreciation like Kaiser Aluminum or US Air but now had seen the errors of his ways :) But that doesn't seem to be the case when you look at all these building materials and other investments. Sometimes I'm reminded of Marx's reputed statement that he wasn't a Marxist. Buffett isn't a Buffettologist! I'll have to take some more look at some of these and try to understand them. David