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

To: Paul Senior who wrote (14166)	3/29/2002 3:42:10 PM
From: rich evans	Read Replies (1) \| Respond to of 78748

Hey Paul, does SLR qualify as a value investment yet. They were downgraded by Moodys for their debt but SLR debt is not an issue in my opinion. They reported Debt to cap ratio of 39%. But the ACES mandatory convertibles are really equity so the debt to cap is 30%. JBL is 20%. And debt net of cash is in the teens. And debt net of cash and inventory which is take or pay is 0. They had 1 bill in cash flow from operations this quarter and will continue to very cash flow positive. So the whole problem is revenues. SLR and JBL revs for next quarter also projected flat but they have announced a lot of new business which they need to improve their metrics . For example JBL revs flat But it was seen better because of its cost metrics are so much better. Inventory turns over double SLRs at 4.5 versus 9 for example. DSO for JBL at 40some days versus 64 for SLR. Gross margins 50% better then SLR. SO SLR needs revs badly to increase their run rate of 3 bill as the SGA their is 7.5% which eats up all their profits but they have announced new revs coming of 1 bill per quarter which should be accretive but they are ramping slowly and wont be fully ramped till end of 2203 per cc. Maybe the market though will see this and bid them up on expectation of future now that balance sheet is OK. They are at book value right now. Rick