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Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: JDN who wrote (48402)	4/19/2002 7:12:15 AM
From: Ben Antanaitis	Read Replies (2) \| Respond to of 64865

Fri 7AM CNBC Squawk Box hosts and co-host taking great pains to bash SUNW over and over again.

To: JDN who wrote (48402)	4/19/2002 12:12:55 PM
From: Charles Tutt	Read Replies (2) \| Respond to of 64865

Thanks for that explanation. Since the book value of an acquired company can be pretty arbitrary, isn't goodwill, also? JMHO Charles Tutt (SM)

To: JDN who wrote (48402)	4/19/2002 1:16:49 PM
From: QwikSand	Read Replies (1) \| Respond to of 64865

JDN: I join with Charles in thanking you for that explanation, but I want to ask one follow-up question along the same lines Charles asked. I haven't gone and looked up the details of the acquisitions that created that sizable goodwill item on SUNW's balance sheet. But what does it mean to shareholders if goodwill is acquired during a bubble, when by definition companies have unrealistic valuations? I would guess that during such a time, that goodwill premimum over the carrying value of the acquired company's net assets is going to be at its highest point. A comparable acquisition today would be at a much lower price, even though the value of most of the underlying assets might be the same or nearly so. If the goodwill line on the balance sheet (which represents a big cut of shareholder's equity) was entered during a period of extreme asset inflation that is now over, does that mean current book value is inflated by today's standards? I guess if those acquisitions were made with SUNW stock, which was itself an inflated asset at the time it was used, it might be a wash. --QS