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Non-Tech : Tyco International Limited (TYC) -- Ignore unavailable to you. Want to Upgrade?

To: blankmind who wrote (3281)	5/3/2002 2:12:12 PM
From: shoe	Read Replies (1) \| Respond to of 3770

Does anyone know why Tyco did not or was not able to sell CIT or the plastics division? Were the bids not high enough? PaineWebber has a strong buy on the stock right now, but they also recommended it (as a buy) when it was in the 40's. Some quotes from their 4/26 report: ...Tyco will be able to hit its most recent financial targets. Cash flow growth should exceed income growth in 2003: We believe the two primary drivers of the increase in cash conversion will be the absence of bonus payments for senior executives (the cash bonus payment in 2002 should exceed the bonus accrual) and spending on the Tycom Global Network will be significantly lower (management indicated new network spending would approach zero, down from roughly $1.2 billion in fiscal 2002). Since 1995, Tyco has purchased over $61 billion in businesses. Netting the roughly $23 billion of net debt and dividing by shares outstanding yields an original purchase cost of $19 per share of Tyco stock, less than 10% below the current level of the stock. We believe this simplistic measure is overly conservative, since among other items, this measure fails to account for cash reinvested in the business (capital expenditures have exceeded depreciation), synergies and growth in the business. Additionally, on our reduced expectation for fiscal 2002 earnings, Tyco is currently trading at 8.0 times current year earnings per share.