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To: kodiak_bull who wrote (14941)	11/17/2002 7:08:50 PM
From: Libbyt	Respond to of 206326

Another point of view on THC... BARRON'S: Hedging Is Best: Behind Charles Jobson's High Returns Is.. A Mix Of Aggressive Short Plays And Defensive Longs (1 of 2) An Interview With Charles Jobson Investors like Jobson and Chris Argyrople, his colleague at Boston-based Delta Partners, don't come around too often. Through Wednesday, the long-short portfolios the two manage for institutions and wealthy clients were still up smartly on the year: 25.5% gross, 20.4% net of fees. They've made money in all but two months, May and October, this year. You have to go all the way back to July 2001 to find another month in which they didn't have a gain. People don't know what to do here. There are good companies that have disappointed or have some new uncertainty surrounding them and they have plummeted -- and it seems as if there is no bottom. Tenet Healthcare is an example. Then there are a ton of beaten-down tech stocks whose fundamentals are awful. Some have doubled in the past three weeks. Ultimately, this latest rally will be seen as a bear-market rally. Q: How is your portfolio positioned? Q: Are you investing more in bigger names as a result? A: We've owned HCA for about five months or so, and we bought some Tenet Healthcare when the shares first broke down to $28 from about $60 and, lately, we've been buying it more aggressively at $14 to $15 a share. Those would be our biggest-cap stocks. Q: Do you have concerns about Tenet? A: There's no question they were too aggressive on billing for outlier patients -- the sickest patients -- and now the government is investigating their outlier billing practices. Their billing was in the letter of the law, but they abused the spirit of the Medicare law. Tenet is getting 5% of its total revenues from outliers, versus the industry average of 1.5%. Jeffrey Barbakow, the chairman and CEO, sacked people for the aggressive billing, and it's an open question whether he survives. On top of all that, they had a couple of cardiac doctors in their Redding, Calif., hospital allegedly doing unnecessary surgeries, and the FBI raided the hospital. I think those two issues are unrelated. But the combination has caused Tenet shares to drop precipitously. Q: So why get involved? A: However bad it can get, it can't get as bad as the decline in the share price suggests. The stock is absurdly cheap. Making the worst case for the company -- that it refunds 2002-2003 outlier payments of $996 million to the government and it pays $500 million to settle class-action suits -- the company should still earn $2.05 a share, excluding outlier revenues, in fiscal 2003 ending May. That's up 60% from the most recent fiscal year, and it trades at 7.3 times earnings. Including outlier revenues, it should trade at 3.6 times Ebitda [earnings before interest, taxes, depreciation and amortization, a measure of operating cash flow]. The hospital fundamentals are outstanding. The issues that have cropped up aren't going to sink Tenet, and the company will be able to increase earnings by 15% a year. (MORE) DOW JONES NEWS 11-15-02