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Technology Stocks : IBM -- Ignore unavailable to you. Want to Upgrade?

To: j g cordes who wrote (7509)	3/9/2002 10:37:34 PM
From: smchan	Read Replies (1) \| Respond to of 8218

IMO, EPS only matters w/ respect to share price. I don't care if it grow by virtue of buybacks or not as long as the ratios are inline. It doesn't take a rocket scientist to look at absolute earnings and profits and recognize whether those components are growing or not. Sam

To: j g cordes who wrote (7509)	3/9/2002 10:53:30 PM
From: Robert Scott Diver	Read Replies (1) \| Respond to of 8218

While reading the article on IBMwhich you posted from 2000 in 2002, I continue to wonder why EPS rising partly because the number of shares is decreasing would be viewed as a problem by an investor. EPS is the key to calculating the PE ratio. The number of shares outstanding does not enter into the calculation. While income from the pension fund can only be used for pensions, a thoughtful investor might also recognize that not having to put money in the pension fund in the near future is a good thing. A half-bright article writer might also notice that increasing debt related to a profitable credit operation is also a good thing. One might keep in mind that FCF, not reported profit, is what determines whether buying shares back would necessitate increasing core debt. A look at the financials would indicate that the buybacks did not increase core debt. Since many of the things I mentioned apparently were not mentioned in the article, IMHO it is not only dated, but focused only on negatives. One could surmise that the writer had an agenda overriding journalistic principles.