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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: pgerassi who wrote (172067)	12/2/2002 1:43:47 PM
From: GVTucker	Read Replies (1) \| Respond to of 186894

pgerassi, RE: Shares outstanding somehow are changing when they should be the same. Look at the Third quarter earnings report. The first and third columns are for the period ending September 28, 2002 but show different share amounts for outstanding and diluted. For the three months ending 9/28/02, the shares outstanding were 6,646 million yet for the 9 months ending 9/28/02 they claim 6,669 million shares. Ditto for diluted shares, 6712 and 6792 respectively. The same goes for periods ending in 9/29/01. This can not be right, unless they are using some other point than the date ending of a period. Sigh. Yes, it can be right. Look at the top of columns 1 and 3. Column 1 is for the 3 months ended 29 Sep 02. Column 3 is for the 9 months ended 20 Sep 02. Thus, the share numbers that you're looking at SHOULD be different on the income statement whne the share count is changing. The column 1 number is for the 3 month average, while the column 3 number is for the 9 month average. With both diluted shares and common shares declining this year, the more recent 3 month average should indeed be lower than the 9 month average. This is all as mandated by GAAP. Sorry, no fraud there. And as the line headed "Proceeds from sales of shares to employees, tax benefit & other" shows, this revenue was recorded at $279 million for the 3 month period ending 9/28/02. You are looking at the cash flow statement, not the income statement. They are different things. As I noted before, the "Proceeds from sales of shares to employees, tax benefit and other" has nothing to do with revenue, that is why it appears on the cash flow statement, to balance net income to cash. That same 3Q/02 report shows that even with a supposed profit of $686 million they lost $273 million in stockholder's equity. Now some of that is the dividends of $133 million. Thus a difference of $826 million still remains or $1,057 million before taxes of $231 million. That is too close to the repurchase number to have no real link. As I said when you started this whole BS, when shares are repurchased above book value, the net result is a decline in book value. Although there are some items missing from your little summary above (hence the numbers don't match exactly), the only thing you have managed to do is give a decent indication that Intel's numbers are good. What have you learned: 1) Outstanding shares are what is repurchased. Yeah, so what? Intel is permitted to buy outstanding shares. 2) Rate of repurchases varies with price.' Once again, is there a point? Heck, given that Intel's repurchases seem to have accelerated this year, they appear to be wisely buying back more shares as the price has fallen. Your statement (2) is cause for paise of management, not condemnation. 3) Until this year, shares optioned closely balanced with shares bought back. Well, at least you admit here that this year Intel has indeed been shrinking the float, contrary to your earlier statement. 4) Loss in Total stockholders equity from net operating profit closely matches repurchase costs. Which is an accounting fact when a company repurchases shares with a low book value. 5) Shares outstanding seems to be averaged over a period so care must be taken to get numbers for same length periods. GAAP mandates that shares outstanding be averaged over a period. Good to know that Intel publishes GAAP numbers. In the end, I didn't learn anything there. What I would like to learn is what evidence you have to prove your contention that Intel is publishing fraudulent numbers.