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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: Duffeck who wrote (38934)	5/8/2002 9:50:01 PM
From: akmike	Read Replies (1) \| Respond to of 42804

Hi Duff, So the gross margin or COGS would be $62,000 divided by the sales price In your example, the gross margin is 62000 if the COGS is 38000. What is happening with CSCO's inventory? I am not taking the time to check but my memory is that Cisco bragged about inventory turns being up to 7.5 from 5.7 or so; this would be impossible to achieve under your scenario, since the gross revenues were almost flat. As a further test, cash was significantly increased. If CSCO was playing with books here, it started with the inventory writedown last year and Chambers has been quizzed about that ad infinitum and they have had to update each quarter how much benefit from that has snuck back into the p& l. I won't flat out say that something like this could not happen to some degree, but if it is happening in a meaningful way to a company as much under the microscope as Cisco then we are all in much more serious trouble than I ever imagined. Don't people understand that the auditors of manufacturing companies are paying much more attention to the calculation of COGS, inventory valuation, and a host of other accounting fundamentals since the AA/Enron debacle? Best regards, Mike (No great fan of Cisco or Chambers)