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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Ausdauer who wrote (21395)	12/30/2001 2:17:09 PM
From: Mike Buckley	Respond to of 60323

Aus, Not to be argumentative, but I only made one point -- that in order for Art's assertion that the company might very soon become so cash-flow positive from operations that the company might buy back some shares, a significant turn around from the current year would be necessary. I demonstrated it by showing that the company's free cash flow has been very negative. But I only took one year to task. Mike, 2001 was a year of consolidation for SNDK... ...after a period of explosive growth during 1999 and 2000. I think for those with a longer term perspective and patience that these cost saving measures will eventually pay off. Since you're bringing a longer-term perspective into the discussion, please be reminded that in the last three years and nine months the company has not produced one dime of free cash flow. It's actually produced negative free cash flow over a nearly four-year period. Investors who believe that the free cash flow (which I believe is a much clearer metric than earnings) will change over a long period of time should be very convinced about the circumstances that will be very different in the next four years than in the last four years. If those investors are counting on a share buy-back as Art suggests might happen as a way to boost the price of the stock, it's important to remember that it's not earnings that buys back shares of stock. It's cash -- something the company hasn't generated on a net basis in the last four years except by selling shares and taking on debt. --Mike Buckley