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Technology Stocks : Jabil Circuit (JBL) -- Ignore unavailable to you. Want to Upgrade?

To: maroon who wrote (6063)	8/29/2002 7:56:00 AM
From: WTMHouston	Read Replies (1) \| Respond to of 6317

<<what am i missing?????>> The accounting angle -- I suspect -- but I am no expert at this. Try it this way: the $250M gets depreciated over say 30 years at $8.3M a year. For the first 4 years that is $33.3M in depreciation. Of course, this assumes that the physical assets (the ture capital investment) are really worth $250M. If not, then I believe they get to take a big hit up-front for the difference and then depreciate the rest over expected life, which may be less than 30 years. Assuming a more realistic 1.5% margin, there is $60M "net" against $33.3M "expenses." Of course, if the margin is 5 percent, then the net gets much nicer looking. It is all how you manipulate, er mix, the numbers accounting wise. Isn't this method of acquiring business what patroller was criticizing other ECMs for a few months back. Sure seems like JBL has been "buying" a lot of business lately. Troy