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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (15309)	8/24/2002 5:45:34 AM
From: Bob Rudd	Read Replies (2) \| Respond to of 78700

DXT: Saw LT debt as 47.2 +.05 Capital Lease + 5.7 Operating lease...so total debt-like obligations 53mm, Backing the lease down a bit to adjust for interest: EV/(EBITDA-CAPEX)=(3.18*1.60+50)/(7.57-2)=9.9...not bad, if supported by FCF similar to (EBITDA-CAPEX), but FCF is negative...which would be ok if this co were in growth portion of lifecycle, but not so ok in mature/declining phase. Low Price/sales is often a trap when looking at high debt companies. From a business standpoint...pencil manufacture hits me like textiles or broom making, something where it's going to be tough to compete with low labor cost economies. Yesterday, I bought a pack of 4 mechanical pencils at a dollar store for a buck. They work ok and I don't need a sharpener. So even if the manufacture of the little wooden wonders remains here, there will be market share loss to ever cheaper imported mechanicals as well as electronic media [PALM], methinks.