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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: Stock Farmer who wrote (55744)	9/29/2001 7:22:07 AM
From: Wyätt Gwyön	Read Replies (3) \| Respond to of 77400

interactive.wsj.com A lot of analysts now say that tech companies such as Cisco can't even begin to turn the corner until the gray market inventory is burned off. And based on that assumption, it isn't surprising to hear that Cisco may be attempting to expedite that process by destroying perfectly good second-hand gear and components. "Cisco is taking back a lot of its own equipment. Tons and tons," says John Lynch, a principal of Asset Recovery Center, an Eatontown, New Jersey-based firm that buys and remarkets gear from bankruptcy liquidations. "And they are just crushing it." Lynch contends that Cisco has hired Houston-based Waste Management to destroy certain critical parts, known as supervisor cards, that are integral to Cisco routers. Without the cards, routers are basically useless, he says. "They are the brains of the machines," Lynch says. ...The netherworld of asset recovery isn't a tidy business. Lynch says Cisco's service reps sometimes drag their feet when he wants the company to recertify gear. In one case, when he was selling gray-market gear to a major Cisco customer, Lynch says he had to use the customer to pressure Cisco to recertify the gear. "Cisco risked the loss of a major customer that has bought hundreds of millions of dollars' worth of gear. [The customer] is under budget constraints, too, and let Cisco know about it," Lynch says. Cisco wouldn't comment on the assertion.

To: Stock Farmer who wrote (55744)	9/30/2001 8:13:48 AM
From: Monty Lenard	Read Replies (1) \| Respond to of 77400

Hi John, here is you a new analytical tool that is easy to set up in excel. Wonder how crisco rates? :-) There is a specific mathematical model called the Altman Bankruptcy Predictor that is widely used in the turnaround industry to assess and predict a company's short-term survival prospects. The model is named after the renowned Edward I. Altman, Max L. Heine Professor of Finance at New York University's Stern School of Business, who published the initial research back in 1968. stern.nyu.edu Altman's Bankruptcy Predictor (or Z-score) is calculated as follows: Z = (1.2X1)+(1.4X2)+(3.3X3)+(0.6X4)+(1.0*X5) where: X1 = Working Capital / Total Assets = WC/TA X2 = Retained Earnings / Total Assets = RE/TA X3 = EBIT / Total Assets = EBIT/TA X4 = Market Value of Equity / Book Value of Liabilities = MVE/BVTL X5 = Total Sales / Total Assets = TS/TA The Altman Z-score is used to determine a company's short-term outlook or future viability, where: > 3.0 ... Strong 1.8 - 3.0 ... In danger < 1.8 ... Near death According to one scholarly journal, Altman's Bankruptcy Predictor has proven consistently accurate over the period of time since its development. The original samples in Altman's research displayed accuracy of 95 percent based on data from approximately one year prior to failure. The accuracy dropped to 72 percent based on two-year data. Subsequent tests on firms that have gone bankrupt since 1968 have shown an accuracy level of 82 to 85 percent. According to the same journal, Altman's model is also used for a number of different purposes throughout other industries besides the turnaround industry; i.e.: a) Credit analysis for accept/reject decisions, b) Investment analyses for money managers and investment bankers, c) Auditors' analyses for going concern assessments, d) Legal analysis for prudent man and failing company doctrine defenses, and e) Merger target analyses both before and during reorganizations. What Altman's formula doesn't tell you is what to do with the results. That you have to determine for yourself. Monty