Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Paul V. who wrote (59193)	5/2/2002 3:00:10 PM
From: BWAC	Respond to of 77400

You have to read the 10K and look at all the components/breakdown of cash, cash equivalents, types of long term investments, etc. There is no standard answer. Just because its in LT Investments category does not mean it can't be extremely easily converted to cash. Government Bonds, Treasuries, etc. Read and learn. 10k's will define exactly what a company considers cash, equivalents, long term, and short term. As well as the methods used to value these investments. We've been through the CSCO cash thing a hundred and one times. $21.5 Billion is liquid, and stable. Liquid Investments are categorized LT or ST on the books based largely on the companies intent. Which can change as conditions do. "I was also told that if a company buys back its stock with cash for "x $" amount per share and the stock drops in price that this can tremendously drop the cash flow ratio within 60 days" No. Shares bought back go into the Treasury at the cost paid. Future price is irrelevant to whats on the books. "what impact does purchasing treasury stock with cash have on the cash flow ration" None. Its a USE of cash available. Thats why the Statement of cash flows is broken down into three components. Cash From Operations, Financing Activites, Investing Activities. ".? I can see very quickly how a company with $2.5 B or even CSCO with $21+B and no debt could soon get into Cash problems, especially if they have some debt." Huh? CSCO's cash needs are whatever it takes to finance its inventory, wages, R&D, etc. until it is sold and converted back to cash. A company with no debt runs into cash problems if they can't sell their inventory for a very long time at prices above breakeven. I think you might need a new advisor.