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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Charles Tutt who wrote (59753)	7/12/2001 4:07:19 PM
From: Dennis Doubleday	Read Replies (1) \| Respond to of 74651

> You wrote: I do think it is inappropriate to base growth comparisons on figures including investment income, especially if you're unwilling to do it consistently when there are losses. I don't think one should take the stance that "earnings is earnings" when investment income is positive, but try to brush it aside when it's a loss. Not only that, but the text cited in an earlier message said something to the effect of "Once MS decides that an investment loss is more than just temporary", they take the loss as a one-time charge AND THEY KEEP THE STOCK IN THEIR PORTFOLIO AT THE NEW REDUCED BASIS. That means any future "gains" against this basis will be lumped in with EPS numbers for future quarters. Quite misleading. The real question is not "why do the companies play these games?" but "why aren't they called on them by Wall Street?"

To: Charles Tutt who wrote (59753)	7/12/2001 4:19:55 PM
From: Exacctnt	Read Replies (1) \| Respond to of 74651

<<<I do think it is inappropriate to base growth comparisons on figures including investment income, especially if you're unwilling to do it consistently when there are losses. I don't think one should take the stance that "earnings is earnings" when investment income is positive, but try to brush it aside when it's a loss.>>> I've prepared financial statements for a Fortune 100 company. Those statements and each line item of income/expense do not tell the whole story on how good or bad the results were. That is why any extraordinary event during a quarter is highlighted and discussed in managements' statements. The analysts base their commentary after digesting the significance of those events. If a company did not report the extraordinary items when releasing the information, analysts would be the first to question what the results were minus extraordinary events. You are focusing your displeasure on the wrong target. The analysts, investors and the market itself determines whether or not extraordinary items matter when evaluating a company.