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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: LTK007 who wrote (89570)	7/2/2002 12:06:11 PM
From: milesofstyles	Read Replies (1) \| Respond to of 99280

itsallover, i posted the article bcuz i thought you were unsure of the effect, when you asked zeev "is this calculated or a hunch".zeev is correct in his assessment i believe in that the net effect will appear to be better earnings. regarding its "impact",by only making one adjustment per year, i guess you are eliminating an expense "stream" in the form of depreciating goodwill. perhaps it will result in topsy turvy fundamentals in that a company may show 3 improved qtrs and then take a wallop during the annual writedown. i've always kinda prided in the fact that i was capable of fundamental analysis. at least two years ago i started a discussion on the 3 amigo's thread regarding the net result of what the intangibles would have and the huge debt being racked up to buy overpriced assets. no one agreed with me at the time and i took some pretty harsh criticism at the time. but its all come about in the end. on sharcki's thread i pounded the table on the necessity to understand cashflow statements. here i warned someone of what looked to be inevitable. Message 16425799 six months later, i was proven correct. however, i've kind of changed my tune on the overall feelings about cash flow. enron did that for me. their ability to plug numbers to "cash from operations", pretty much renders that statement useless. not everyone is enron, but its a definite wrench in what i perceived to be one of the better statements to analyze. one day i'll have to sit down with enron's stmts to see if it could have been caught by someone like myself. other fundamental analysts say it could have and was ignored. i don't know. one additional positive effect this change will have is it will likely clean up some of this bs surrounding book value's, while cleaning up the balance sheet somewhat. Message 17647496 this analysis came as a result of a stock being indicated as a "come back" play. i requested additional analysis from the original poster, but apparently it went ignored.other likely effects would seem to include roe and roa numbers as much as i respect chuck hill's work, i am not sure he can have numbers reflecting this activity, as it seems its may be the company's judgement how much should be written off. if the company should pre announce the number, then yes, he can make the adjustment, otherwise i'm just not sure. i agree with him that wcom is not the end-all and that there will be others. perhaps as soon as next qtr if things don't improve as i'm under the belief that the shenanigans are continuing in the form of pre booked revenues to meet this qtr. so it will take a stronger next qtr in order for some companies to meet again. in general, along with others i've lost my taste for fundamentals. it would only seem natural the flow to TA would result until the situation can be addressed to the point that the numbers being put out are once again reliable on fundamental stmts. milesov